The Columbia, South Carolina office market experienced one of its strongest six-month periods ever with absorption of office space topping 200,000 square feet. Once again, the overall occupancy rate reached an historical record as of June· 30, 1999 at 92.1 %. This rate is slightly greater than year end 1998 when occupancy levels reached 92.0%. The minor change in the percentage of occupancy, given the strong absorption, is due to several new office buildings being added to the market during this reporting period. The absorption of 200,000 square feet during this six-month period may enable the market toi surpass the 225,000 square feet absorbed during all of 1998.
The Columbia office market now consists of almost 9.8 million square feet of multi-tenant office buildings situated in the Central Business District (CBD) and four suburban markets. By many accounts, the strength of the market can be measured by the occupancy rate of Class A space, the presence of new construction in the market and increasing rental rates. As of mid year 1999, the occupancy rate for Class A space was 94.4%, inclusive of almost 200,000 square feet of newly constructed space being completed during this period. Additionally, the market has over 130,000 square feet of multi-tenant office buildings under construction. The market also has over 625,000 square feet of "build-to-suit" new construction taking place. The Columbia market is also experiencing sharp rental rate increases in most market areas, but most notably in the CBD where average rents have increased over 10% during the last year.
The strongest market in the Columbia area continues to be the Northeast market with an occupancy rate of 95.8%. The market having the lowest occupancy is the Cayce/West Columbia area with an occupancy rate of 90.3%. A detailed review of each of the five market areas
in Columbia can be found in the Market Spotlight section of this report.
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