Colliers | Columbus
RISING OFFICE SUBLEASE SPACE
Written by: Brett Cisler
For the last 21 years, Brett Cisler has served as a real estate advisor specializing in representing a large portfolio of clients and tenants in Central Ohio. Brett maximizes his clients’ real estate investments through his comprehensive strategic approach to the business, while leveraging Colliers International’s strong research and marketing team to maintain the most up-to-date knowledge of the market. Keep reading to get Brett’s take and more information on the recent rise in office sublease space.
80% of available sublease space is in Class A & B buildings. How do you think this will impact asking rents for these types of properties?
Sublease rates are typically below the market rate, so I think they will eventually push overall rates down as these spaces try to compete.
Currently, the majority of available sublease spaces are in the CBD, Dublin and Worthington. Does this surprise you? Why or why not? Do you anticipate an increase in another area in the future?
This does not surprise me. Downtown, Dublin and Worthington are where a large majority of space is located, as well as several of the largest organizations that are still fully working from home. Northeast Columbus will most likely see an increase in sublease availability, as that area has a lot of moving pieces. Alliance Data Systems is subleasing multiple large spaces and it is rumored that others are coming.
What do you think landlords will have to do to compete with this sublease space on the market?
Landlords will offer longer terms with more certainty, as well as more willingness to complete TI (tenant improvement). Sublease spaces will typically not offer tenant improvements but will reduce rent and, a lot of times, include furniture in the space. Ultimately, this will push rental rates down for the overall market.
How do you anticipate this influx of sublease space affecting vacancy and leasing activity in Columbus?
In coming quarters, this will increase vacancy and competition for tenants looking for space.