28
Warning: My office building's vacancy rate just hit 12% and I didn't see it coming
I was reviewing the quarterly report for our property in Tempe and the number jumped out at me. We had a solid 95% occupancy for years, but two midsize tech tenants left last month and we only filled one spot. It matters because our loan terms get reviewed if we drop below 90%, and now I'm scrambling. Has anyone else in a suburban office market had a sudden dip like this?
3 comments
Log in to join the discussion
Log In3 Comments
grant.margaret4mo ago
Nah, that's been brewing for a while.
6
avery_fox934mo ago
Remember how my friend's plant died after months of weird yellow leaves?
2
Tempe is a solid market but 12% is still nothing compared to what I've seen in Phoenix proper. The real issue isn't that tenants left, it's that you probably didn't have a waiting list or enough smaller tenants to backfill quickly. If your loan terms are that strict, maybe it's time to rethink your tenant mix instead of blaming the market.
5