Office Vacancy Rate Hits a 17 Year High;There Are Some Telling Exceptions To the Bad News
Vacant office space continued to accumulate in the second quarter, the latest indication that businesses aren’t planning significant hiring in the near future.
Office buildings across the U.S. lost 1.8 million square feet of occupied space in the quarter, pushing the national office vacancy rate to 17.4%, the highest level since 1993, according to New York-based research firm Reis Inc.
But it’s not all doom and gloom.
There’s at least one boomtown bucking the trend:
Washington, D.C., had the lowest vacancy rate, 10%, among the cities that Reis tracks, due partly to the expansion of the federal government. (Partly?-ed.) In Washington, the Securities and Exchange Commission recently leased 200,000 square feet and is considering taking more. (Gee, I wonder why?-ed.)
And New York’s vacancy rate has “stabilized”.
“Why?” you ask? Well…
The market is turning around in part because nonprofits are adding space now that rent levels have fallen.
So basically, the government and nonprofits are expanding and nothing else is.
Now, I realize that many nonprofits do good work, and I’m pleased that they have a little more leverage to conduct said work.
However, unless the private sector is revitalized, this state of affairs will simply be unsustainable–the lifeblood of nonprofits is the wealth created by the private sector, after all.
And here I thought libs liked “sustainability”.