Despite challenging conditions in the financial market, there were only modest increases in the overall vacancy rate for office and industrial properties in the first three months of the year, according to broker Cushman & Wakefield of Connecticut.
Office vacancies rose 2.9 percent from the first quarter of 2008, while industrial vacancies were up 1.2 percent, Cushman & Wakefield said today in its first-quarter 2009 report. Further, in the face of the national trend, the amount of sublease office space on the market actually declined by 33 percent year over year.
“While we anticipated an increase in the overall office vacancy rate, compared to Q1 2008, the increase was less than expected,” said Jonathan Putnam, executive director in Cushman & Wakefield’s Hartford office. “And the fact that the availability of sublease office space has actually declined is encouraging in this climate.”
Office vacancies in Hartford County have risen by 800,000 square feet from a year ago, but sublease space has declined from 293,806 square feet to 219,869 square feet.
Office rents have risen from an average of $19.65 in the 2008 first quarter to an average of $20.04 this year, due mainly to a large percentage of new vacancy occurring in the higher priced buildings.
“The dramatic news in the Hartford office market this quarter is United Healthcare’s announcement that they will move from 450 Columbus Blvd. to CityPlace I in mid 2010,” said Putnam. “This move will be a net positive for the city of Hartford because it keeps a major employer downtown, it shores up a center city landmark building and creates a new vacancy in an attractive, large block of space with great parking on site.”
Industrial vacancies in Hartford increased from 8.6 million square feet to 9.8 million square feet, pushing the vacancy rate from a 10.2 percent a year ago to 11.4 percent currently.
