<![CDATA[As the year has progressed, the Northern Nevada Office Market has continued to improve at a healthy rate. Although end of year statistics are not yet finalized, the most notable trend is the continuation in in-bound businesses surveying Northern Nevada as a more likely candidate for relocation. The economic development in the office sector is increasing. Although Tesla’s announcement captured the headlines in the industrial sector, others such as Independent Salon Services, Ghost Systems, Flirtey, White Rabbit and most recently, Clear Capital, have joined the growing list of tech-related companies joining our entrepreneurial community. These transactions are imperative to the momentum of the office market as just these companies alone absorbed over 50,000 gross square feet. The inbound activity, coupled with organic corporate growth, fortifies the continued advancement in the office market with vacancy rates continuing to decline to the point that there are numerous developers planning on building speculative office product; an undertaking our community has not seen for the past decade. With Class A vacancy rates in the three core submarkets; Downtown, Meadowood and South Reno, decreasing to 10 year lows, prime office land acquisitions have been completed poised for future construction. Keep an eye out for the Rancharrah Business Center; a future project in the highly sought after Kietzke Lane corridor and existing building repositions made by Basin Street Properties (Gateway) and NevDex (Professional Circle) in South Reno. Current Market Statistics:
- Overall vacancy (not including Garden Office): 9%
- Class A lease offerings starting at $2.00 per square foot/month, Full Service
- Nearly 600,000 SF of office space sold compared to 902,000 SF in 2013
- Average acquisition price per SF: 2013 = $103/SF; 2014 = $166/SF
- Anticipated year end net absorption of approximately 60,000 SF pending outstanding lease negotiations (compared to over 200,000 SF in 2013, a decrease partly attributable to the disposition of assets in bad debt situations)
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