Posted at 12:12 p.m., Thursday, January 11, 2007
O'ahu office space rents expected to rise this year
Advertiser Staff
O'ahu businesses probably will have to pay more for office space this year even as demand for space is forecast to slow, according to a new report.New and expanding businesses should expect landlords to ask for $2.85 to $2.90 on average per square foot to rent office space this year, up 10 percent to 12 percent from $2.59 last year, according to a report by local commercial real estate firm Colliers Monroe Friedlander.
Colliers said the pressure for higher rents this year, which follows a 10 percent increase last year, is due to the level of vacant office space that hasn't been as low since 1991.
"Tenants will likely face stiffer increases over the near term as competition for prime office space becomes more intense," Mike Hamasu, Colliers research and consulting director, wrote in the report.
Colliers reported that 1.1 million square feet, or 7 percent, of O'ahu office space was vacant at the end of last year. Though the empty space is the rough equivalent of a 110-story building, a 10 percent vacancy rate is considered an equilibrium at which tenants and landlords have equal leverage.
