From Walt Arnold, SIOR, CCIM - Albuquerque, NM
Last week we discussed the “For Lease” office market as well as my predictions for the Super Bowl. Did 8 years in the NFL and 2 playoff games pay off in my game day forecast? Listen below to find out…
Click HERE to listen to the Real Estate Report for 2.1.10
Bob Clark, News Radio 770 KKOB: Walt, you wanted to talk about the “For Lease” office market. What do you have for us?
Walt: 2009 was an up and down year for the Metro Office market. The overall vacancy rate was the highest in recorded history at 18.1%.
On the flip side the office market actually grew by 454,000 sf or 3.8%, thanks to Fidelity Investments 108,000 sf, and the 53,000 sf Aperture building, both in Mesa Del Sol, and HP’s 218,000 sf building in Rio Rancho.
The median asking lease rate in the metro office market is $16/sf/yr. Asking rates for Class A is $22.50/sf/yr, Class B-$19/sf/yr and Class C is $15/sf/yr.
Bob: The high vacancy rate must be pushing these rates down. What is going to happen with the actual lease rates this year?
Walt: Our asking lease rates are holding up well but Landlord’s are competitive both to acquire new tenants and retain existing ones. Blend and extend strategies will continue with Landlords making concessions now and increasing the lease term in order to keep tenants through this downturn.
Bob: What about the employment numbers? Unemployment is at 10% and at that number it must be impacting the Office Market.
Walt: Yes, many of those layoffs where in employment categories that had office tenants and unemployment has impacted the office market.
One good sign in the office market is that the office space employment outlook is positive in almost all markets. That said, the office market is going to take some time to recover and these vacancy numbers might even increase as sublease space comes back on the market. But in these times it is interesting how a cessation of bad news is treated like good news.
We have some great locations for office users, if you are looking for new office space or need help renewing, give us a call, we can help.
Bob: Ok now the important stuff, what’s your Super Bowl prediction?
Walt: I based my prediction on 8 years in the NFL and 2 playoff games. So I analyzed it from an insider’s point of view.
I played in the old Memorial stadium in Baltimore, right before they moved to Indy and it was a dump, no wonder they left. I had some good games in the Superdome and it is an awesome facility, so that vote goes to the Saints.
Colors- black and gold versus blue and white, I have to go with black and gold.
My receivers coach at UNM, Gene Huey, has been with the Colts for 16 years but Archie Manning, longtime Saints QB was a teammate of mine at the end of his career in Houston, even though Peyton is his son I am looking at his Saints career. So for those reasons, I am going with the Saints to win 31-24. If you dispute my totally scientific prediction, call me at (505) 256-1255 or check us out on the web at waltarnold.com. Who dat dem saints gonna beat. See ya Bob.
To share your feedback or questions, leave a comment below or email me atWalt.Arnold@svn.com!
Tags: albuquerque, commercial, cre, for lease, investments, market report, NFL, office market, property, radio show, real estate, super bowl, walt arnold