August 14, 2009
Charlotte Observer
Two reports on Charlotte’s commercial real estate market released this week show a continued decline in demand for commercial space as employers contract and retailers close up shop amid weak consumer spending….Net absorption, or the amount of space occupied minus the space vacated, was negative 134,800 square feet during the first half of this year for Charlotte-area office space, according to Karnes Research. Last year, net absorption was a positive 670,800 square feet. The two years prior it was around 1.4 million per year. “Demand is down, a lot,” said Karnes analyst Andrew Jenkins.
Also noteworthy: No new buildings were completed in the suburbs during the first half of this year. That hasn’t happened since 1992, Jenkins said. Last year, developers put 2 million square feet of new space on the market, all of it in the suburbs, according to Karnes. “It’s a good sign the developers have pulled back and are aware of what was going on,” Jenkins said. “They’re tightening belts, and it’s hard to find financing to build new buildings. At least they recognize this is not a good time to be delivering speculative space.”
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