By Gavin Curtis
The final quarter of 2018 capped off yet another strong year for Greater Seattle commercial real estate. Looking specifically at the office sector, across all of the headline metrics, the region continued its robust growth.
Large-scale players: Amazon, Google and Microsoft gobbled up a lion’s share of the capacity, however; small and middle market companies also expanded their footprints in the metro’s 39 distinct submarkets. Business owners scrambled in Seattle’s CBD for space with 250,000 square feet of net absorption and 1 million square feet of space leased quarter 4 of 2018.
The absorption totals in Greater Seattle pushed the vacancy rate to 6.1%, while average gross asking rents clocked in at $35.56 per square foot. These values all represent cycle records, a trend that will endure into 2019.
Taken from a year-over-year perspective, quarter 4 of 2018 far outpaced quarter 4 of 2017 in Seattle’s CBD.
- Vacancy rate: 8.3%
- Availability Rate: 9.2%
- Net Absorption for 2018: 475,000 square feet
- Average Class A asking rents: $48.57 per square foot
Positive market sentiment is best portrayed by the over 8 million square feet currently under construction in the Greater Seattle area, and set for occupancy over the next 24 months.
Greater Seattle’s sustained economic energy places it as one of the nation’s premier commercial hubs. When the next recession does arrive, metro stakeholders will find the region has greater resiliency than competitors; due to industry diversification, world-class talent, best-in-breed businesses and an innovative and entrepreneurial culture.
Also announced last year, Seattle will finally be getting a hockey team. Playing out of KeyArena, an $800 million renovation of the facility is currently underway, led by the Oak View Group (OVG); an organization with a national footprint of premier sports and entertainment venues.
The City and OVG are partnering together on a 39-year lease with an additional option of two eight-year extensions. OVG will finance the transformational redesign with no injection of public dollars.
As for the return of hockey, the metro has a championship pedigree. In 1917, the Seattle Metropolitans were the first U.S. squad to hoist the Stanley Cup after outskating the Montreal Canadians. In their brief nine-year tenure, the Metropolitans played in three Stanley Cup finals.
Sounds like a perfect name for the new team!
However, the ownership group, Seattle Hockey Partners has secured other competing options:
- Seattle Cougars
- Seattle Eagles
- Seattle Emeralds
- Seattle Evergreens
- Seattle Firebirds
- Seattle Kraken
- Seattle Rainiers
- Seattle Renegades
- Seattle Sea Lions
- Seattle Seals
- Seattle Sockeyes
- Seattle Totems
- Seattle Whales
The continued growth of the Puget Sound’s office and job market will only further increase the demand for ticket sales for the new hockey team. A terrific 2018 sets up 2019 to be another stellar campaign.
Gavin Curtis is a vice president at Hughes Marino, an award-winning commercial real estate company with offices across the nation. Contact Gavin at 1-844-662-6635 or firstname.lastname@example.org to learn more.