The Albuquerque office market posted slightly negative net absorption for Q2 2018, with no significant activity taking place during the quarter.
Although the quarter’s approximately 95,000+/- sq. ft. of leasing activity was the lowest since Q4 2012, the 110,000 sq. ft. of space vacated this quarter was the
lowest in seven years, maintaining the upward trend in the quarter’s net absorption compared to last quarter.
The overall vacancy rate remained practically unchanged at 20.4%, down 8 basis points (bps) from last quarter.
There are no other new construction projects currently underway in the market.
The gross median asking rate of $15.50 per sq. ft. annually was down $0.09 from last quarter but remained stable over the year. There are no signs of significant rent growth in the coming quarters.
The market is expected to rebound with many large transactions being completed in H2 2018. Over 107,000 sq. ft. of existing vacant space will be absorbed by three different new tenants entering the market.
There is a high level of activity among tenants currently looking for space in the market. With multiple large occupiers entering the market in H2 2018 and one of the largest commercial properties in the Albuquerque office market being sold to an owner-user, there are clear signs that the market is regaining vitality.