Transwestern: Office decline not as ugly as tech wreck - Washington Business Journal:

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According to the report, Class A office space in Dallasaveraged $21.68 per foot in Decemberf of 2006 and continued to rise until droppingb back down to $21.64 cents per squar foot in June. Meanwhile, Class B office spacew was pricedat $17.34 per square foot in Decembed of 2006 and also trended upward until falling back to $17.38 per foot in June of this Riis Christensen, senior vice president at Transwestern, said Frida that there has been "a two and a half year peel back in quoter rates." He added that 77 percent of Clasas A buildings have reduced their rates in the last six while 79 percent of Clasds B buildings have lowered rates.
Christensen said Class C buildings are feelinf the pinch of aconsumer market, wherew Class A and Class B properties are loweringb rates to stay competitive. "For successfu l businesses this is when there is a flight to quality from to 'B' or from to 'A', Christensen said. "People will upgrade, or they will use the markett to renegotiate where theyare now." The broade economy that led to the new conditions includexs a higher unemployment rate and the fact that Dallas-Fortg Worth bled 49,500 jobs in the 12-montb period ending in April, the report said. The overalkl vacancy rate in the offics market stoodat 16.9 percenft in the second quarter. That is up from 16.
7 percengt in the first quarter, but lower than the 17.2 percengt recorded a year ago, accordinhg to the report. Rents were lower in both the Classa A and B commercialp property sector in the first half of thereport indicated. In the second quarter of 2009, net absorptiobn in the industrial markettotaled 1.2 milliojn square feet, which is the same amounty recorded during the same period of 2008. The overalll vacancy rate in the second quarter alsowas 11.1 down slightly from 11.2 percent during the first but up from 9 percent compared to a year ago.
Despits changes related to the economy, Christensen added that 900,00o square feet of space was still absorbed this He believes this speaks well for how diversifiedthe Dallas-For Worth market is. "We're not seeing in the greatg recession the really big ugly losseas that we did in thetech wreck," he "Dallas is still going to be a job growthu leader, and that fuels everything," he "The regional economy is weaking, but it is outperformingf the rest of the