Columbia’s office market rental rates are at an all-time high in the central business district and market-wide vacancy is up 8.8% in the second quarter of 2018, a report (.pdf) by commercial real estate company Newmark Grubb Wilson Kibler found.
In the central business district, rates have reached an all-time high of $20.18 per square foot. The total asking rent in the central business district is $20.22. The highest total asking rent is $20.30 per square foot in North Columbia, with the lowest in Cayce/West Columbia at $13.33 per square foot.
Second-quarter transactions of note included IMG renewing its lease of the Landmark II building at 3700 Forest Drive. The property features 8,842 square feet. The company also leased the 22,000-square-foot IKON Building at 7 Technology Circle in Northeast Columbia.
In January, the 265,000-square-foot State Media Co. building at 1401 Shop Road sold for $16,625,000 ($62.74/SF). The land and building have been contracted with a subsidiary of Twenty Lake Holdings, with the McClatchy Co. entering a 15-year lease and making annual lease payments of $1.6 million per year.
Overall, the Columbia office market vacancy rose from 8.5% last quarter to 8.8% this quarter.
The report noted the lack of new office space construction, pointing out that the market has seen no significant inventory additions since 2016, when the First Base Building in the BullStreet development and the Innovation Center at 550 Assembly St. were completed.
“The current rental rates simply do not justify the cost of new construction at this time,” the report said.
In the industrial market, total asking rent for the CBD is $5.55/SF. The highest rate is in St. Andrews at $8.15/SF and the lowest is in Kershaw County at $2.53/SF.
The total vacancy rate is 7.4% in downtown Columbia, down from 7.9% at the end of the prior quarter.