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Seattle and Eastside Office Sublease Trends October 2021

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SEATTLE
Though leasing activity continued to pick up in October the amount of sublease space available saw a modest net increase over the month, breaking a five-month streak of reductions. 83,000 sq. ft. of space was subleased this month, with deals 10,000 sq. ft. or greater being signed at 1000 Second, 4th & Madison, and Rainier Square, along with a handful of others deals smaller in size. This activity was offset by Galvanize placing their space at 111 S. Jackson back on the sublease market, an addition of 71,000 sq. ft., and 40,000 sq. ft. of space being added between 999 Third (22,000 sq. ft.) and 1111 3rd (18,000 sq. ft.). With everything accounted for at the end of October, Downtown Seattle experienced a 37,000 sq. ft. gain in sublease space available. Despite October’s net gain, it’s important to point out that an average of 87,000 sq. ft. of space has been leased each month over the past six months. With economics still favoring tenants in the short-term and tenants solidifying return to office plans, it’s likely that leasing activity will continue at or above this pace and fuel further net reductions in availability throughout the rest of the year and into 2022. 

EASTSIDE
Irrespective of occupancy dates, it’s obvious that tenants looking to grow or establish themselves on the Eastside need to find space quickly if they’d like to occupy any space at all (particularly on the premium end). October saw another net reduction of sublease space available, this month totaling 30,000 sq. ft. Leasing activity accounted for 13,000 sq. ft. of that this month, and 26,000 sq. ft. of sublease space was withdrawn across two floors at One Bellevue. Important to note here as well is that less than 10,000 sq. ft. of space was added to the sublease market for the second consecutive month. At 1.38 million sq. ft., sublease space available on the Eastside is at its lowest point since December of 2020. As a percent of inventory, sublease space available is now below five percent in six of the eight submarkets on the Eastside (Mercer Island and I-90 being the two above that threshold), and below four percent in four of those submarkets (520 Corridor, Redmond, Kirkland, and Issaquah). Looking ahead, availability will continue to tighten over the tail end of 2021 and well into 2022 as demand chases an increasingly scarce amount of space.

 

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Seattle and Eastside Office Sublease Trends October 2021

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Jacob Pavlik

Research Manager

Seattle

Jacob Pavlik joins the Colliers team after working in the Economic Development and Planning departments for the cities of Hillsboro, Oregon and Alexandria, Virginia, respectively.  At Colliers, he leads a team of researchers to  collect, analyze, and synthesize market data for Puget Sound and Portland. He loves the challenge of taking complex data and making it easily digestible for a wide audience. He assists brokers with research specific to their client's needs, including geovisualizatoin and micromarket analysis.

His authentic passion for commercial real estate is seen most clearly when Jacob explores his local urban ecosystem and travels to new cities around the world to see how they function and relate to each other. He likes to see the built environment adapt to the changing needs, desires, and behaviors of the people who populate it. These functions fit perfectly into Jacob's role as Research Manager, telling the story of how commercial real estate in the Pacific Northwest evolves over time.

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