Business Journal: Office Leasing Slips
Commercial office construction continues to dominate the skyline in Downtown Sacramento. But the buildings may be only partially leased for the next few years.
Monday, October 29, 2007
Sacramento’s longtime booming commercial office market has hit a major problem – too much available space and not enough tenants, according to industry reports. And that empty feeling will likely continue for some time, as developers are building almost 3 million square feet of offices, the most since at least 2000, and some housing-related companies, such as homebuilders and mortgage lenders, are closing or moving into smaller space. That 3 million figure includes two downtown office buildings with a combined 800,000 square feet – enough space for about six Wal-Mart stores. In fact, Sacramento developers are building more office space than St. Louis, Orlando and Fort Lauderdale, combined. Elk Grove and Rocklin are the hardest-hit cities in the four-county region, with office vacancy rates of more than 20 percent.