By Christina Lee Knauss
The amount of office space available in the Columbia area is poised to increase soon, according to a report on the third quarter of 2021 released this week by Colliers | South Carolina.
According to the report, activity in the Midlands office market was relatively flat during the third quarter, with 2,169 square feet of negative absorption during the quarter. However, an increase in available office space is expected by the end of this year and in early 2022.
While the Columbia office market wasn’t hit as badly by the pandemic as those in larger metro areas, the Colliers report noted that it is now seeing the same overall general trends – namely, an increase in vacancy and slowdown in leasing and sales – on a smaller scale.
The report said the anticipated increase in vacant office space will be partly fueled by several large business tenants who may be planning moves or space contractions in the next several months.
According to the report, there was 14.28 million square feet of available office space in the Midlands in the third quarter, down from 14.63 million available square feet during the same time in 2020.
The average lease rate for Class A office space dropped slightly from $21.38 per square foot in the second quarter to $20.71 per square foot during the third. The overall vacancy rate for the third quarter was 12.09 percent, up from 11.8 percent in the second.
The Colliers report stressed that the anticipated increase in vacant space shouldn’t be alarming but could allow for some positive changes.
“Vacancies in quality space will allow tenants to upgrade to higher-quality space that was previously unavailable and will give owners a chance to update dated space that is vacated,” the report stated. Also, it noted that large blocks of available space could be attractive to prospective tenants from outside the market who previously could not find adequate space.