Office Vacancy Rates Dip Slightly in Third Quarter

Vacancy rates in 43 downtown office markets across the United States dipped to an average 16.2% in the third quarter from 16.3% in the second quarter, while vacancies in suburban office markets rose to 23% from 22.7%, according to a survey released by Coldwell Banker Commercial Group.

The strongest downtown office market in the nation was found in Hartford, Conn., where vacancies stood at 5%. The only other downtown markets where rates were below 10% were mid-town Manhattan, Sacramento, Boston, Philadelphia and Charlotte, N.C.

The weakest downtown office market was in Austin, Tex., where vacancies stood at 35.8%. Oklahoma City had a 33.3% vacancy factor and Denver, 30.3%.

Austin had the dubious distinction of also having the worst suburban office market, with a 42.3% vacancy factor. Mid-New Jersey was the second-weakest suburban market, with a 40.5% vacancy rate.

Meanwhile, vacancy levels at industrial projects dropped to an average 5.8% in the third quarter from 6.1% in the previous quarter. Seattle’s 1.8% vacancy rate made it the strongest industrial-space market, while Houston’s 13.7% vacancy factor made it the weakest industrial market.