The 15-million-square-foot metro Rochester general purpose, multi-tenant office market had a quiet second quarter in 2012, according to Reis. The vacancy rate was unchanged from the first quarter at 16.9%, down 30 basis points year-over-year. First Glance data from Reis show a third quarter rate of 17.1%. The Class A vacancy rate is reported at 14.8%, up 70 basis points over the quarter and up 140 year-over-year. The Class B/C rate is reported at 18.1%, down 50 basis points for the quarter and down 140 basis points year-over-year. Although the most recent data indicate increasing vacancy, the rate is at least staying within the 17.0% mark even as space has been added, due in part to the first quarters’ solid net absorption total of 227,000 square feet. Second quarter’s total was a scant 6,000. Thus far in 2012, Reis’ latest construction data note the completion of the 18,200-square-foot third phase of the Penn Fair Office Park and 15,500 square feet at 97 Canal Landing Boulevard. Reis’ latest construction data list building three of East Victor Place, with 12,000 square feet, and the Seneca Building, at 109,000 square feet, under construction with respective completion dates of December 2012 and August 2013.
Rochester office rents have not been stellar performers, but have been showing strength. Second quarter average asking and effective rents rose 0.2% to $16.23 psf and $12.05 psf, respectively. The year-over-year gains are 1.1% and 1.3%, respectively. Since this market saw gains of only 0.9% asking and 1.1% effective for all of 2011, the current performance should give landlords some encouragement. First Glance data give a third quarter asking rent of $16.21 psf. Class A asking rents are reported at $20.13 psf and Class B/C rents are reported at $13.90 psf. Reis expects asking and effective averages to increase by 1.6% in 2012, but more substantial gains of 2.0% and 2.8% are forecast for 2013, with similar annual gains to follow.