The Pittsburgh office market strengthened further during the third quarter, with Class A product breaking records as reported in Newmark Grubb Knight Frank’s newly released third quarter Pittsburgh Office research report. Class A vacancy rates rested at or below 5.5% in several submarkets including the CBD, North, and the Southpointe segment of the South submarket. Increasing demand from several industry sectors including professional and financial services, energy, healthcare and technology assisted in driving market activity.
“Quite frankly, we are running out of premium space. This is as low as I’ve seen Class A product in my 37 years in this industry,” says Gerard McLaughlin, executive managing director of the Pittsburgh office of Newmark Grubb Knight Frank.
Key statistics for the Pittsburgh office market during the third quarter of 2012 are as follows:
• Vacancy Rate - 14.3%
• Class A Vacancy Rate - 8.6%
• Absorption - 245,330 square feet
• Weighted Average Asking Rental rates - $20.03/sf/yr
• Class A Weighted Average Asking Rental Rates - $23.03/sf/yr
Overall market vacancy maintained its downward trend over the quarter with little speculative construction set to deliver in the next six months. Tenants in search of larger blocks (25,000 square feet and up) of high quality space in several submarkets will be challenged with few opportunities and fewer landlord concessions.
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About Newmark Grubb Knight Frank
A part of BGC Partners, Inc. (NASDAQ:BGCP), Newmark Grubb Knight Frank is one of the largest commercial real estate service firms in the U.S. It brings together the strategic consultative approach to creating value for clients and leading position in the New York market that are hallmarks of Newmark Knight Frank; the complementary strengths of Grubb & Ellis in leasing and management, investment sales, valuation and capital markets services; and BGC’s financial strength, proprietary technology, expertise in global capital markets and deep relationships with many of the world’s leading financial institutions.
Newmark Grubb Knight Frank, together with its affiliates and London-based partner Knight Frank, employs more than 11,000 professionals, operating from more than 300 offices in established and emerging property markets on five continents. This major force in real estate is meeting the local and global needs of tenants, owners, investors and developers worldwide.