The 17.3-million-sf Portland CBD office market registered120,000 sf of net absorption, pushing overall CBD office vacancydown 100 basis points to 10.3% while the class A CBD vacancy ratefell 60 basis points to 7.6%. In response, the asking rental ratejumped $0.50 per sf to just over $23 per sf per year, according tothe report.

If the rental rate growth continues on that pace, the annualgrowth rate would be 6% and by the end of the year the asking CBDrental rate would be about $24.50. Patricia Raicht, the regionalresearch director for G&E, tells GlobeSt.com she expects thatto happen.

"The CBD rental rate increases will be felt more significantlyby those seeking larger blocks of space, as there are only threeclass A availabilities larger than 20,000 sf," she says. "Tenantsseeking fewer than 10,000 sf will still have some room tonegotiate."