May certainly brought sunshine to Southwest Washington, but it also brought the lowest total number of consummated transactions for Clark County office properties in 2009.
Vacancy rates increased while average lease rates decreased, according to Adam Roselli, broker at Vancouver-based Eric Fuller and Assoc.
Due to the economic climate, more tenants than ever are attempting to renegotiate their leases.
Most deals for Class A space are being done for about $20 per square foot annually – the lowest rate in a year – and landlords are no longer scoffing at more extensive space upgrades on three-year leases, Roselli said.
In May, there were 1.19 million square feet of available Class A and B office space in Clark County, creating a vacancy rate of 20.19 percent. Month-over-month net absorption was -1,014 square feet, while year-over-year net absorption was -9,365, according to Roselli.
Vacancy rose slightly from March and April, but was down from the year-to-date high of 20.39 percent in February.
The submarket with the least amount of vacancy is Camas/Washougal, with 6.8 percent office vacancy and an average weighted lease rate of $17.50. The submarket with the greatest vacancy is Orchards/Battle Ground with 26.7 percent vacancy and an average rate of $18.17.
While there have been signs of an upswing in the housing market, Roselli expects recovery in the commercial real estate market to be months away still.