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SEATTLE-The window may be closing for tenants looking for the most favorable office lease deals, suggests Grubb & Ellis Co. “Landlords may not be as aggressive six months from now and tenants will want to lock in favorable terms and concessions while they still can,” according to the company’s 2004 forecast for the local market.

Average asking gross lease rates in Downtown Seattle are up a full percentage point in the fourth quarter to $25.95 per sf, according to CB Richard Ellis Inc.’s local office report. In the Eastside submarket, asking gross lease rates inched up to $22.87 per sf. Meanwhile, Colliers International pegs fourth-quarter vacancy in the 21-million-sf CBD at 13.6%, 30 basis points higher than the third quarter.

However, the tide is not about to turn toward an owner’s market any time soon, Grubb & Ellis cautions.

“Even though vacancy has stabilized, rental rates may decline further until there is significant demand,” according to the Grubb & Ellis report. “Landlords are competing with a large amount of sublease space, which continues to affect pricing.

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