Negative Absorption Spooks Market, but Fundamentals Remain Healthy
As we cross over the mid-year mark, the Tampa Bay MSA office market remained relatively steady. However, for the first time since the recession of 2007/2008, the market started to experience an increase in available space. This uptick in vacancy is primarily due to tenants consolidating operations or vacating the market. Although this negative absorption raised some concern, it’s too early in the cycle to determine a trend. Based on the current level of market activity, absorption is expected to pick up through the end of 2018 and indicates a possible absorption of new vacancy. Year- over-year, Tampa Bay has seen a steady decrease in vacancy alongside healthy upward pressure on rates.