Colliers Report: Rental Rates Continue to Rise Despite Increasing Vacancy
April 5, 2023
Commercial Real Estate Research & Forecast Report
Q1 2023 Columbia Office
Market Highlights
Rental rates continued to move upward this quarter despite net negative absorption and the addition of vacant space to the market. While seemingly defying the rules of supply and demand, disaggregation of the vacant space reveals that much of it is encumbered for one of three reasons.
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Key Takeaways
- Rental rates continued to move higher
- Several office buildings were converted to alternative uses
- Absorption was negative as additional sublease space became available
Summary
The vacant space is either in blocks that are difficult to subdivide; contained in a building that lacks amenities or desirable surroundings; or the landlord lacks the financial resources to improve the space or the common areas. This leaves tenants with fewer choices and gives owners in well located and appointed buildings leverage to demand more rent from potential tenants and tenants who want to renew.
About Colliers
Colliers | South Carolina is the largest full-service commercial real estate firm in South Carolina with 62 licensed real estate professionals covering the state with locations in Charleston, Columbia, Greenville and Spartanburg. Colliers is an Accredited Management Organization (AMO) through the Institute of Real Estate Management (IREM) and is the largest manager of commercial real estate properties in South Carolina with a portfolio of over 18 million square feet of office, industrial, retail and healthcare properties. Colliers’ staff hold the most professional designations of any firm in South Carolina. Colliers | South Carolina’s partner, LCK, provides project management services for new facilities and renovations across South Carolina.
Colliers (NASDAQ, TSX: CIGI) is a leading diversified professional services and investment management company. With operations in 65 countries, our 18,000 enterprising professionals work collaboratively to provide expert real estate and investment advice to clients. With annual revenues of $4.5 billion and $98 billion of assets under management, Colliers maximizes the potential of property and real assets to accelerate the success of our clients, our investors and our people. Learn more at corporate.colliers.com, Twitter @Colliers or LinkedIn
