Pandemic stifles office leasing activity
- Due to hesitancy surrounding the Coronavirus, office market absorption was positive, but minimal. The overall office market absorbed 35,232 square feet.
- No new construction was delivered to the Greenville-Spartanburg submarkets during the second quarter of 2020.
- In the next few quarters rental rates are expected to continue to rise, pushed by an overall increase in building operating expenses and construction costs. With rates continuing to rise, rental concessions are expected to rise as landlords fight to maintain occupancy through changing workplace dynamics.
Office activity hits pause during the second quarter of 2020
Commercial real estate absorption within the Greenville-Spartanburg submarkets was minimal during the second quarter of 2020. The highest positive absorption within one building was 8,808 square feet and the building losing the largest tenant only posted negative 10,295 square feet. There were only 18 buildings that posted any positive absorption in Greenville-Spartanburg market; while only 10 buildings posted negative absorption. The hesitancy resulting in marginal activity was caused by uncertainty surrounding the pandemic. While tenants navigated through the challenges of working remotely and updating safety precautions in anticipation of returning to their offices, leasing activity was put on hold. However, office leasing activity is expected to resume at a positive rate during the third and fourth quarters and quarantine restrictions are relaxed or lifted and tenants reassess their office leasing needs post-Coronavirus.
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