| Pasadena sets pace,
as Burbank follows closely, Glendale lags |
LED by red-hot Pasadena and an improving
Burbank, the Tri-Cities office market tightened in the third quarter
even as the sluggish Glendale submarket continued to lag.
The overall vacancy rate fell to 9.4 percent,
more than a point lower than the previous three months, with Pasadena
recording a 5.6 percent rate, third lowest of all county submarkets,
according to Grubb & Ellis Co.
Burbank
saw its vacancy rate drop to 8.4 percent, almost three points lower
than the first quarter, while Glendale's rate remained high at 14.4
percent.
Brokers attributed Pasadena's
strong performance to its attractive retail and housing markets,
as well as its accessibility. It also has become a center for high-tech
businesses.
"(It's) the location
of choice for many companies in search of space in the Tri-Cities,"
said Doug Marlow, executive vice president with CB Richard Ellis.
With the market tight already,
just 33,800 square feet of space was taken off Pasadena's inventory
in the second quarter, compared with the 91,500 square feet absorbed
in the prior three months.
This
has helped push up asking rents for Class A office space one penny,
to $2.53. "Look for explosive growth as technology firms like Yahoo
move into the content business," Marlow said. "Health care and engineering
also have performed well recently."
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