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TAMPA, FL-The Tampa Bay area continues to be the hottest office leasing market in Central Florida, checking in with third-quarter net absorption of 1.38 million sf, the highest number posted in five years, according to a new study by the Tampa office of Colliers Arnold. Orlando, Tampa’s perennial rival, recorded 642,977 sf of net absorption in the quarter, as GlobeSt.com previously reported.

Overall vacancy has improved to 10.7% from 11.8%. New office construction is at 730,341 sf, with 519,094 sf slated to be developed as class A space.

The 12-million-sf Interstate 75 corridor in Tampa Bay led all submarkets with 713,166 sf of positive absorption. That was double the 375,957 sf posted in the second quarter. Overall vacancy in this market is 8.9% with class A space at 7.3%. New construction totals 204,750 sf. A total 140,000 sf was completed in the third quarter. The overall lease rate is $17.70 per sf, with class A at $20.62 per sf.

Of the six main Tampa Bay submarkets, only the 4.3-million-sf North Pinellas submarket was down with a negative 64,149 sf. Overall vacancy is 11.5% with class at 8%. Only 50,691 sf of new construction is in the pipeline. The overall lease rate is $18.54 with class A at $21.01 per sf.

Westshore, Tampa Bay’s largest office submarket at 13.8 million sf, had only 12,909 sf of net absorption in the third quarter, down from 300,154 sf in the second period. Overall vacancy was 11% with class A at 9.2%. A total 137,000 sf of new space is under construction. The overall average lease rate is holding firm at $19.56 per sf. Class A space averages $21.95 per sf.

The 7.86-million-sf Tampa central business district submarket shows an overall vacancy of 15.5% and class A at 19.7%, the poorest leasing performance of all the submarkets. Still, the 84,594 sf recorded in the third quarter was an improved from the negative 63,522 sf posted in the second period.

In the 6.8-million-sf Gateway submarket, net absorption totaled 116,860 sf, an improvement from the 58,454 sf chalked up in the second quarter. Overall vacancy is 8.6% with class A at 3.2%, the best performance of all the submarkets. Only 25,000 sf of new construction is under way. Another 20,000 sf was completed in the third quarter. Overall rents are $17.78 per sf with class A averaging $19.28 per sf.

The 3.6-million-sf St. Petersburg submarket has an overall vacancy of 7.2% with class A at 4.6%. Net absorption was 10,428 sf, down from 31,013 sf in the second period. New construction totals 200,000 sf. The overall lease rate is $18.06 per sf with class A at $18.88 per sf.

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