Despite the slumping economy, the vacancy rate for class A office market in southeastern Wisconsin dipped in the third quarter, according to Inland Companies third quarter office market report.
The region’s class A office space had a vacancy rate of 12.0 percent in the third quarter, down from 12.7 percent in the second quarter, according to the report. In downtown Milwaukee, the class A office space vacancy rate fell to 11.7 percent in the third quarter from 11.9 percent in the second quarter. The top eight class A buildings in downtown Milwaukee (U.S. Bank Center, Milwaukee Center, 100 E. Wisconsin, 411 Building, 875 E. Wisconsin, Cathedral Place, 789 N. Water, 1000 N. Water) are in even better shape. Those eight buildings have a vacancy rate of about 7 percent, according to the Inland report. In the fourth quarter of 2006, those same eight buildings had a vacancy rate of about 11.78 percent, according to Lyle Landowski, vice president of office brokerage for Inland. Expansions by downtown office tenants and the lack of new office buildings has helped bring down the class A vacancy rate, he said. The 411 E. Wisconsin Ave. building has the largest amount of available class A office space downtown, about 100,000 square feet (including a block of 47,000 square feet), Landowski said. The Milwaukee Center is 95 percent occupied, but a 40,000-square-foot space will be opened up before 2010 when Legion Insurance Co. closes is office.
The area’s class A office market continues to outperform the overall office market. The overall metro Milwaukee office space vacancy rate was 16.6 percent in the third quarter, down from 17.0 percent in the second quarter, according to the Inland report. The overall downtown office space vacancy rate was 19.5 percent in the third quarter, down from 20.1 percent in the second quarter, according to the report.
