Silver lining on the horizon for office investors amidst vaccine debut
The fourth quarter of 2020 saw overall office asking rental rates decrease to $19.35 per square foot full service, breaking a nearly two-year long streak of a slight escalation in rates in the Albuquerque market.
The rate decreased $0.35 per square foot from Q3, and the vacancy rate rose by 43 basis points, from 15.45% to 15.88%. The market experienced a negative absorption of 60,273 square feet, as some businesses brought the year to a close by downsizing or closing their office operations. Still, the vacancy rate remains lower than the year end rate of 2019, which was 16.37%, and 2021 presents plenty of opportunities for the office market to rebound.
Key Factors in this Quarter
Many businesses have recognized the importance of collaboration in office spaces over the last year, as innovation and creativity have been required to keep teams physically separated working together efficiently.
Most of the quarters’ negative absorption occurred as small scatterings of activity.
COVID-19 is still here. However, the vaccine is the light at the end of the tunnel.