Office Market Remained Hot in 2017
The Reno office market held strong through the end of the year and finished with 61,734 square feet of positive net absorption year-to-date, despite the slight decrease in the fourth quarter with negative 17,608 square feet. While there was a good amount of activity in the market this quarter, the number of tenants downsizing overtook the absorption. The year ended with 11.1 percent direct vacancy and 12.1 percent total vacancy inclusive of 1.0 percent of sublease vacancy. In keeping with the trend of the market, direct vacancy declined from 11.3 percent in the third quarter and decreased a total of 1.2 percent from the beginning of the year. In addition, rental rates continued to increase with the year ending at $1.68 per square foot per month for buildings that do quote rates, although many owners do not quote rates. Rents have increased $0.07 since the beginning of 2017 as well as $0.03 from the third quarter. Overall, the market saw high activity this year and is expected to remain strong going into 2018.
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