Office market well positioned for a strong end of the year
At the conclusion of the third quarter, the metro Milwaukee office market is well positioned to have a strong 2019. On the horizon, BMO Tower, a 360,017 square foot multi-tenant office building is positioned to open in December. BMO Harris Bank, Michael Best & Friedrich, Heartland Advisors and Andrus Law Firm all pre-leasing space in the building.
For the quarter, five of six submarkets realized positive absorption and vacancy held steady market-wide. Leasing activity continues to be healthy, the strength of which is not entirely reflected in the numbers as a result of a few large move-outs in class B suburban product. Class A product continues to perform well with higher class space being absorbed at larger levels than lower classes of space. The strength of the market is further represented by strong demand activity, which is just shy of 2.4 million square feet, eight percent higher than historical market demand. A number of mid-sized new lease and expansion deals were closed this quarter, with the move-ins planned for later this year. These deals, along with the delivery of BMO Tower, will result in a strong end to the year with Q4 expected to realize the highest levels of absorption in 2019.