Strong demand noted for local office space

CB Richard Ellis has reported that office absorption during the third quarter continues to demonstrate strong demand for office space, most notably in the suburban market.

The company warned, however, that the amount of new construction coming online could lead to some softening in the future.

Paul Skene, office specialist in the Salt Lake City office, said that by year-end, the Salt Lake County market will have added 1.79 million square feet of new office space. Also, 1.14 million square feet is under construction, scheduled for completion in 2008 and 2009. The combined 2.9 million square feet equates to more than 10 percent of the county office market inventory.

The Salt Lake Metropolitan Office Market absorbed over 540,000 square feet during the third quarter. Even with several new buildings being added to the inventory, the overall metro vacancy rate declined, but the overall average asking lease rate fell slightly, the company said.