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SARASOTA, FL-With a shrinking pool of available office and industrial space, tenants are coping with what has become a landlord’s market, according to Colliers Arnold Q3 office and industrial market reports.

For the third quarter, the average direct asking lease rates were $21.61 per sf and the class A direct asking lease rate was $25.20 per sf in Sarasota and Manatee counties. By comparison, the overall rate for the third quarter in Tampa was $19.53 per sf and the class A rate was $21.69 per sf. The Q3 vacancy rate was 8.2% in Sarasota, 9.7% in Tampa and 13% nationwide.

In the industrial market for Q3, the average direct asking lease rate for a flex-only building is $10.26 per sf, an increase from $9.80 per sf during the prior quarter. The rate for industrial-only buildings is $5.63 per sf compared to a rate of $5.60 during the previous quarter, the report states. “The quality of life in Sarasota and Manatee counties is very good, they have a lot of choices there,” Colliers Arnold director of commercial services Christopher Leonard tells GlobeSt.com. “[Sarasota] has been pro-development. You see a lot of coastal communities that have not been.”

As a result of activity in the area, particularly along the Interstate 75 corridor, developers have been pursuing retail and office projects. “You don’t see a lot of industrial developments because there are higher and better uses for the land,” Leonard says.

In the report, Colliers Arnold predicts that steady growth will continue in the Tampa Bay area. “We are not predicting any ‘bursting bubble’ in commercial real estate,” the report states. “Vital numbers are good–vacancy is down, absorption is up. In addition to these real estate indicators, population and job growth continue to have the most influence on our market.”

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