In spite of a vacancy rate hovering around 15 percent, the Tampa Bay area's office market is expected to remain among the strongest in the nation next year. That's the forecast from Marcus & Millichap, which calls itself the largest commercial real estate investment brokerage in the nation.
The company, which has its headquarters in Walnut Creek, Calif., ranks the Tampa-St. Petersburg-Clearwater metropolitan area ninth in expected absorption of office space for 2004. That's down from third place in 2003, but still the highest in the state. Washington; Las Vegas; New York City; Tucson, Ariz.; and several California markets all ranked higher.
Among the highlights of the Tampa Bay area forecast: The office vacancy rate is expected to slip from 15.4 percent to 14.9 percent as job growth stimulates demand. The average effective rent is expected to increase less than 1 percent, to $15.45 a square foot, by the end of the year. Rent concessions are being used to fill Class A space. New construction is expected to pick up, with 639,000 square feet scheduled for delivery, double this year's output.
