The Greenville office market consists of 6 million square feet of multi tenant office buildings, situated in the central business district (CBD) and the suburban market. The Greenville office market continued to soften during 2002 as the recession to soften during 2002 as the recession lingered on. Overall, market occupancy levels decreased from 82,6% at year-end 2001 to 78% on December 31st, 2002. Net absorption for 2002 was 104,000 square feet, but 340,000 square feet of direct vacant space was added to the market during 2002. Also, 54,000 square feet of new sub-lease space was added to the market during 2002, all of which contributed to the decreased occupancy levels. For the year, leasing activity continued to be slow with very few large tenant in the market. All of these factors resulted in putting downward pressure on rental rates, especially in the suburban market.
The overall availability rate at year-end 2002 was 25.3% of the office space added to sub-lease space). 25.3% of the office space in the Greenville market is available, either through direct vacant space from landlords, or through sub-lease space. Our survey shows that the suburban market is significantly weaker than the CBD market.
Central Business District
The CBD occupancy rate was 86.2% on December 31st, 2002, which is a slight increase from 85.7% at year-end 2001. The CBD's absorption was 154,000 square feet for 2002, a relatively good year.
Many consider Class A space to be the true barometer of the health of a market. Using this standard, the CBD turned in a particularly good year. The Class A absorption was 179,000 square feet, primarily due to the delivery of two new Class A buildings to the market, mostly pre-leased. Developer Phil Hughes completed the construction of the 75,000 square foot NBSC building in the second half of 2002. Also tenants begin moving into the new 108,000 Elliott Davis building late in the year.
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