Seattle's Competitive Office Market Is Landlord-Friendly
Seattle’s office rental market continues to be landlord-friendly, according to a report by Savills Studley.
Seattle Class-A office space went for an average $34/SF rent in the fourth quarter, according to the report. The vacancy rate was 8.7%.
“The 2017 economic expansion in Seattle has set new standards in hiring, net absorption and rent,” Savills Studley Senior Managing Director José Oncina said in the report. “Absent a major socio-political event, the data points to a continued landlord-favorable market in 2018.”
The firm claims Seattle and Bellevue’s office rent is in record territory, putting it on par with markets like Silicon Valley, San Francisco and Cambridge in Boston.
The demand is driven by tech tenants making pre-emptive strikes on available space.
Rents below $30/SF are still available in the suburban markets of Tacoma and Renton, but rates are growing there as well.
The competitive market allows landlords to be selective when choosing tenants, opting for those with strong credit and an established track record.
Thanks to the high demand for office space, landlords are offering tenants fewer concessions. For example, owners are only offering a half month free rent for each year of lease term, similar to San Francisco and Silicon Valley markets. By contrast, landlords in markets such as Chicago, New York and Dallas-Fort Worth typically offer a full month free rent per year of lease term.
