Net Office Space Absorption in Red for Six Straight Quarters in Pinellas County, FL Market

TAMPA, FL--The slowing economy and the weak job market have sapped much of the demand for office space in Pinellas this year, reports Randy Smith, (top right photo) Director of Research, GVA Advantis, Tampa.

In his second quarter 2008 Pinellas Office Market Report, Smith notes net absorption has been in the red for six straight quarters, but its drop in the first half of 2008 was more significant, totaling negative 130,842 square feet.

This is nearly twice the decline in occupancy that was registered in Pinellas for all of last year.

Class B properties, which makeup about 40 percent of Pinellas County’s total office inventory, were hit the hardest.

This year, vacant space for this group pushed past the one-million square foot mark for the first time — at midyear 2008 direct vacancy averaged 19.3 percent for class B inventory, up 220 basis since the year’s start.

Unless there is a dramatic recovery in the second half of 2008, this year could prove to be one of the weakest in terms of annual office sales in Pinellas County.

The aggregate dollar volume of Pinellas office transactions through the first six months of 2008 was $19.9 million, off a dismal 85 percent from the same period last year.

The Pinellas office market will regain its footing as soon as the employment downturn in financial firms and business services companies begins to turn the corner, projected for mid-2009 at the earliest. Until then, users in select groups, especially health services and medical technology companies, should continue to provide some positive momentum for the Pinellas office market in the coming months.

CONTACT:

Randy Smith, Director of Research, Advantis Real Estate Services Company, 3000 Bayport Drive, Suite 100, Tampa, FL 33607. Tel 813.342.4725. Fax 813.372.4004. E-mail rsmith@gvaadvantis.com
www.gvaadvantis.com