Commercial Real Estate is cyclical. That is no revelation, but how we “play” the cycle is important and that is where the clients of Seattle Commercial Real Estate look to our 200 plus years of experience for advice. Right now the vacancy rate in office space in Bellevue is about 2%. That means that landlords can reasonably expect to raise their rates by about 10% over the ensuing 10 months. The vacancy rate across the Eastside is about 8.7%. That means that all of the new space in downtown Bellevue is being absorbed almost as fast as it is being built. That said, the buildings represent large blocks of space while small spaces are trailing behind. The next area in which this will be clearly felt will be the increases in the smaller spaces. At the same time, the next projects coming out of the ground will be in the Spring District and here Wright Runstad has a clear advantage with the potential to meet the next wave of demand.
So much for the good news, the bad news is that a lot of the space has been leased to start up and companies that as of yet have failed to turn an operating profit. What will the real vacancy be going forward. Seattle Commercial Real Estate is closely watching these trends as our investors in commercial real estate are clearly looking for opportunities.