Lack of change has been the common theme of discussion among office brokers for the past seven years, but this is anticipated to change in 2019. Several large tenant relocations combined with a looming office building conversion could reduce the Central Business District’s (CBD’s) vacancy rate by nearly 50%. Such effect will be welcomed by office landlords who have suffered through years of market stagnation.
At the end of the fourth quarter of 2018, the Oahu office market posted a solid gain of 58,707 square feet of positive net absorption. Occupancy losses that accumulated during the prior three quarters were virtually nullified by this reversal in activity and the office market incurred a slight year-end loss of 1,863 square feet of negative net absorption. During this time, vacancy rates rose slightly from 12.77% to end 2018 at 12.79%.