Reno Market Unfolds Extreme Activity
The Northern Nevada market continues to post strong figures with vacancy dropping and increasing positive net absorption for another quarter. The vacancy rate is down to 11.0 percent from 11.5 percent the prior quarter. Due to many large leases in the third quarter, there was 35,382 square feet of positive net absorption. Sales, especially on buildings over 10,000 square feet, also took place. All in all, the Reno office market is extremely active. The only downside is that vacancy rates in certain submarkets, specifically Class A space in South Reno and Meadowood submarkets, is so low that it is hard to find available product. Typically this would result in construction but it appears land pricing and construction costs make new construction hard to pencil. If a company is able to figure out how to construct office buildings at a low cost, they will hit gold as the available Class A space in the market is nonexistent. Unfortunately, this is forcing tenants to make difficult decisions as to their growth in our market.
Have future reports delivered directly to your inbox - click here to subscribe to this and other regional e-mail delivery lists.