1st Q 2009 Office and Retail Vacancy Rates Rise

Vacancy rates across the U.S. office, retail, and industrial markets are continuing to see increases, according to the latest analysis from CBRE Econometric Advisors (formerly CBRE Torto Wheaton Research). The increase is notable, rising by 40 to 80 basis points (bps) for commercial real estate properties in the first quarter of 2009.

The U.S. office vacancy rate rose to 14.7 percent at the end of the first quarter, but was still below the high of 19.1 percent set in 1991. Both downtown and suburban office markets experienced an increase in vacant space, suggesting that the declining demand is now affecting central business districts and outlying suburbs alike.

Retail availability rose to 11.5 percent. Economic conditions continued to place a strain on retailers in neighborhood and community centers, which failed to bounce back in the first quarter, following a very poor holiday season. Fundamentals in the retail sector continue to deteriorate as consumers rein in their spending, including necessary spending.