Westside Still Among Leasing Leaders in U. S.

A mid-year report on office leasing shows that the Westside market remains among the most active in the nation, despite slightly higher vacancies and a big drop in traditional absorption rates, according to Grubb & Ellis Commercial Brokerage Services.

A building-by-building study placed vacancy rates at 11.9% for the six-month period, or 4,165,000 square feet of vacant space from an existing base of 34,759,599 square feet. A year ago, the corresponding vacancy rate was 10%.

The firm said about 316,000 square feet was taken during the first half-year, while 570,000 square feet was leased during the same span last year.

“The loss in net absorption (this year to date) means more space was vacated than was leased in the second quarter,” John Carpenter, vice president and Westside office manager, explained. He predicted that absorption for the remainder of the year would be stronger. Defection of a major tenant from a Santa Monica office building caused the principal drop in absorption.

Meanwhile, high levels of preleasing activity in the downtown Los Angeles market has brought a dramatic decline there in the supply of office space suitable for major tenants during the first two quarters. The vacancy rate was 14.6%, while the absorption level at 730,000 square feet was short of the last year’s first six months’ total of 821,000 square feet.