Posted by PDX Broker’s Commercial Insights: Article No. 7
With everyone noticing the newly available retail spaces in Portland these days it’s interesting to know just how this Third Quarter of 2009 compared to the others before it. As you probably have guessed, vacancy did increase slightly and vacancy rates decreased. As far as new construction, only six new projects were completed.
The average vacancy rates increased to 6.1% at the end of this quarter. The previous four quarters, the market had seen an overall increase in the vacancy rate, from 5.5% the fourth quarter of 2008 to now. Currently there are 326,579 square feet vacant according to CoStar Property.
Vacancy rates always are a little different depending on where in the Portland market you hail from. The following is a list of different districts, including SW Washington, and their associated rates:
CBD….Vacancy =4.6%….Average Quoted Rate=$22.22
Clark County….Vacancy=9.8%….Average Quoted Rate=$19.95
I-5 Corridor….Vacancy=5.4%….Average Quoted Rate=$21.00
Lloyd District….Vacancy=2.1%….Average Quoted Rate=$14.46
Northeast….Vacancy=5.3%….Average Quoted Rate=$13.23
Northwest….Vacancy=4.6%….Average Quoted Rate=$20.26
Polk County….Vacancy=3.9%….Average Quoted Rate=$17.37
Southeast….Vacancy=5.9%….Average Quoted Rate=$15.24
Southwest….Vacancy=7.6%….Average Quoted Rate=$18.43
Westside….Vacancy=5.2%….Average Quoted Rate=$19.55
(Stats Provided By Costar Property—A Great Program I Might add)
Rental rates, as you can see in the above list, are lowest in Northeast, Portland this quarter and highest still in the Portland’s CBD (or Central Business District, a.k.a. Downtown, Portland). The average for the Portland area is $17.24 per square foot/per year. These rates are down 1.3% from the previous quarter, and approximately down 6.21% from four quarters ago.
Net Absorption (the net change in occupied spaced over a given period of time, which also includes direct and subleased space) in the Portland Market was actually positive! While granted, not by much, 50,343 square feet were absorbed this quarter compared to the last three quarters where absorption was negative each time.
So, while there were some good and bad things to note, if you were a tenant of mine I would definitely suggest getting in while the bad is good (Yes, that was my attempt at a joke).
This article is part of the ‘PDX Broker’s Commercial Insights’ series for The Portlander. The column is written by PDX_Broker, a Portlander who works as a Commercial Real Estate Broker in Downtown, Portland. PDX_Broker specializes in Retail Properties and does both Landlord and Tenant representation throughout the Portland Metro and SW Washington areas. She writes frequently about the Commercial Real Estate Industry, Commercial Businesses, and Retail Owners in the Portland area.
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