It’s a record: San Antonio office market soars

SAN ANTONIO – With shrinking supply and rising rents, San Antonio’s office market over the first six months of this year was the strongest the city has ever recorded.

Not only has it seen the highest recorded levels of absorption, but according to CBRE’s second quarter 2015 Office MarketView report, vacancy is back down to prerecession levels and asking rents have surpassed previous highs.

The first half of 2015 saw more than 637,630 sf of positive net absorption, passing the highest level reached at the same time last year by more than 7,000 sf.

And as office space continues to fill up, tenants are displaying a willingness to pay more to get more. Average asking rents increased another $0.28 per sf to settle at $20.95 per sf, and in desirable submarkets or a building with a slew of upscale amenities, that number is soaring past $30 per sf.

While demand for space didn’t increase at the same rate in 2Q 2015 as it did in the first three months of the year, according to the CBRE report, there was still more than 130,000 sf of new user requirements added to the market.

Further, a handful of submarkets will carry the city through the rest of the year.

Northwest San Antonio saw most of the positive net absorption for the quarter, posting nearly 159,000 sf, or 61 percent, of the total net absorption for 2Q 2015.

With the city’s residential, retail and industrial real estate sectors thriving, the office market has good company.

See San Antonio Office MarketView 2Q 2015 (PDF).

Click San Antonio Market Research and San Antonio NewsTalk.