The Greenville office market is experiencing continued marked improvement for the first half of 2005. The total office absorption of 163,027 SF is up 43% from 2004 totals. This resulted in an overall market vacancy rate of 18.6%, down significantly from YE 2004 of 23.7%.
Class A space continued to be the star performer in our market. The market posted Class A net absorption of 99,369 SF. As a result, the Class A vacancy rate fell to 7.1% in the CBD from 8.7% at YE 2004. Suburban Class A rates dropped from 25.8% at YE 2004 to 20.6% for mid year 2005.
Class B and C properties continue to struggle. The overall average asking rental rates for all classes have only slightly increased to $16.28 PSF, up from the YE 2004 level of $15.75 PSF. While the most softness in the market is in the suburbs, even those properties are enjoying an increase in leasing activity.
During the first half of 2005, the Greenville office market experienced marked improvement in all measurements. With occupancies this high, it is expected that new properties will be brought online to meet the rising demand. Class A CBD office space will continue to be our strongest market leader. As new Class A buildings are delivered in the CBD, tenants are leasing them to update their environment. Key hubs such as RiverPlace, ICAR and the Federal Courthouse will attract new cluster development linked by our major traffic arteries.
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