Office Real Estate Market Going Strong for the Ninth Consecutive Quarter

According to Colliers International which is a global partnership of independently owned commercial real estate firms. the national office market continued to make strides during the second quarter of 2005, The April through June period represented the ninth consecutive quarter of positive office market absorption.

Job creation stayed strong during the second quarter, including 'office using employment(1) during this three-month period," said Ross Moore, Vice President and National Director of Research for Colliers International. "This contributed to the continued health of the office market. We anticipate further growth in the third quarter and for the balance of 2005. Just a few office markets project a slowdown, with the vast majority forecasting demand to meet or surpass current levels."

Consistent with lower vacancy, rents showed very modest increases during the quarter. Downtown rents increased 1.1 percent while suburban rents increased only 0.2 percent. Office rents are not expected to demonstrate any meaningful increase during the remainder of 2005, although quickly improving market fundamentals increasingly suggest higher occupancy costs in 2006.

The Top Healthiest Office Markets in Q2:

Downtown:
CITY ABSORPTION (in square feet)
Boston ------------------------------- 551,000
Denver ------------------------------ 440,000
Fort Lauderdale --------------------- 172,000
Houston ----------------------------- 782,000
Miami ------------------------------- 145,000
New York Midtown (south) ---------- 1.1 million
Philadelphia ------------------------- 334,000
Sacramento ------------------------- 167,000
San Diego --------------------------- 155,000

Suburban:
Suburban Baltimore ------------------ 366,000
Suburban Boston --------------------- 907,000
Fairfield County, CT ------------------ 711,000
Suburban Fort Lauderdale ------------ 870,000
Suburban Philadelphia ---------------- 1 million
LA & Ventura County, CA ------------ 1.6 million
Suburban Miami --------------------- 689,000
Suburban Minneapolis ---------------- 583,000
Northern Virginia --------------------- 1.3 million
Suburban Tampa --------------------- 667,000
Suburban Sacramento----------------- 798,000
Suburban San Diego ------------------- 865,000
Suburban Seattle---------------------- 643,000
Silicon Valley --------------------------625,000
Orange County ------------------------ 2.4 million
Suburban Phoenix ---------------------1.7 million
Suburban Portland ---------------------709,000
Suburban Raleigh----------------------- Durham 616,000

Source: Colliers International

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