2016 Q4 Northeastern Pennsylvania Office Report
2017: The Year Ahead
- While the Scranton-Wilkes Barre-Hazleton metro area is in recovery and poised to regain its recessionary job losses by midyear, Moody’s Analytics reports “fiscal headwinds and weak and worsening demographics are sapping the economy’s momentum.”
- The area’s supply of office buildings will only increase minimally due to limited new development.
- We project average occupancy and rent to experience only modest improvement, with steady office leasing demand.
- Some submarkets will perform better than others. Wilkes Barre’s CBD and Plains and Pittston Townships should register economic gains in 2017.
2016: The Rear View Mirror
- The vacancy rate at the end of 2016 was 8.8 percent, down from 9.7 percent at the end of 2015 and below the trailing five year average of 10.6 percent.
- Absorption totaled 57,007 square feet following an occupancy loss in 2015.
- Leasing volume was low in 2016, with few deals over 10,000 square feet. However, there were smaller companies expanding within and into the area such as Service Access Management at the Scranton Enterprise Center for 3,396 square feet.
- The average asking rent for Class A space increased by 2.3 percent from the end of 2015 to $18.67-per-square-foot, full service. Class B rent decreased by an average of 2.0 percent to $15.58-per-square-foot.