Lateral moves make for slow steady growth
Albuquerque’s office market finished the year with a small negative absorption of just 1,013 square feet. The office market currently has 60,000 square feet of space under construction consisting of the Nusenda Credit Union administrative building, located adjacent to the FBI’s building on the frontage road at 4100 Pan American Freeway NE. While Nusenda will own and occupy a large portion of the building, approximately 20,000 square feet will be available to the market for lease in mid-2019.
Fourth quarter market activity was primarily driven by a few large moves. Overall, the North I-25 submarket saw significant negative absorption due to a large vacancy left by UnitedHealthcare (“UHC”) at Paseo Nuevo. UHC vacated the entire third floor totaling 22,811 square feet. UHC as well as Molina, were not awarded state Medicaid contracts for 2019 and are both downsizing.
MZA Associates, a local tech company, moved into just over half of the nearly 50,000 square foot 4900 Lang Ave NE property during the third quarter. In the fourth quarter, MZA expanded its premises to encompass the entire building. This expansion has more than tripled its original footprint of 15,000 square feet. MZA plans to occupy the second floor of 4900 Lang Ave NE in 2019, so no absorption was realized for the fourth quarter stats. With 4900 Lang Ave NE 100% leased, One Sun Plaza is soon to have the largest contiguous block of Class A space available in the North I-25.
Key factors this quarter
MZA Associates, which leased half of 4900 Lang earlier this year, expanded its lease to the entire building.
One Sun Plaza expects to have 53,000 square feet of available space in the third quarter of 2019.
The Airport submarket’s vacancy has dropped to 38.6%, the lowest vacancy rate since 2016.