WHAT'S HAPPENING IN THE COLUMBUS OFFICE MARKET? Q2 2023
Written by: Brooke Ferman
As a Research Analyst, Brooke specializes in research capabilities, providing support for the Colliers Columbus Office, Industrial and Retail groups. She is responsible for executing data reports, maintaining a commercial property database, reporting quarterly trends, performing data analysis and utilizing statistical information to predict future behavior in the market. She also assists the marketing and research director on special projects and corporate initiatives. Keep reading for Brooke's take on what's happening in the Columbus office market.
Tenant Migration - Where are Tenants Moving?
Tenants are constantly relocating their office space to better fit their needs. Using a points system based on signed square feet, we are able to track where office users are coming and going throughout the city. Check out our tenant migration heat map, and click around to find out more information on the movement within each submarket.
Here are some findings from our Q2 2023 Report:
The largest lease of the quarter was signed by a Healthcare tenant in the Dublin submarket.
50% of tenants that signed new leases in the market were in the Engineering/Manufacturing or Real Estate/Construction industries.
High-Rise Report - What's Happening Downtown?
The Columbus office market continues to adjust to the evolving workplace environment. Negative absorption was recorded for the second quarter of 2023, and the vacancy rate increased to 18.77 percent. From a positive perspective, asking rates increased for an overall rate of $22.14. The rising asking rates indicate that the demand for office space remains targeted on new construction and Class A space, which offers desirable amenities. Vacancy in the CBD held fairly steady, increasing to 15.21 percent, which is lower than the overall market’s vacancy of 18.77 percent. The CBD also continues to lead construction activity, with 298,937 square feet currently underway downtown. This includes first phase of Scioto Peninsula, the Front and Fulton development, the second half of the Gravity project in Franklinton and the renovation of the Municipal Light Building. Tenants are continuing to stay active in the CBD, with 28 users representing 261,200 square feet currently searching for space specifically in the Central Business District. Columbus can anticipate increased activity this year as users become more comfortable entering the market and making decisions regarding their office space.
Sublease Activity - Analysis of Office Sublease Space
The majority of available sublease space is located in the Dublin, Easton and New Albany submarkets. 5100 Rings Road in Dublin was vacated by Cardinal Health, resulting in 406,000 square feet available and vacant for sublease. Additionally, Upstart vacated 240,000 square feet at 3075 Loyalty Circle in Easton last quarter. 5400 New Albany Road and 8111 Smith’s Mill Road are vacant and available for sublease in New Albany. These submarkets combined encompass 1.3 million square feet of available sublease inventory.
Since the COVID-19 pandemic, sublease space has increased significantly. In the Columbus office market, there are currently 77 spaces available for sublease, totaling over 2.2 million square feet.
Check out our Q2 2023 Tenant Migration Report, High-Rise Report and Sublease Activity Report here!