Seattle office property sales fall 35% in first seven months of 2017 from previous year

Seattle office property sales for the first seven months of 2017 totaled $2 billion, a 35 percent decline from the $3.1 billion sold during the first seven months of 2016, according to Savills’ Q3 2017 Seattle office sector research report.

However, the overall regional asking rent was essentially unchanged, inching 0.1 percent lower from $30.88 to $30.85. The class A rent jumped by 0.3 percent from $39.23 to $39.34.

Seattle’s overall availability rate fell by 50 basis points to 12.6 percent. The class A availability rate dropped by 0.6 percent to 10.3 percent, though. Compared to a year ago, the class A rate has fallen by 310 basis points.

Seattle has added more than 16,000 office-using jobs in the last 12 months, a 3.1 percent gain that exceeds the national increase of 2.1 percent. As a result, tenants have leased 8.4 million square feet in the four most recent quarters, on par with the region’s long-term average.

Amazon’s search for a second base of operations may be having an impact on Seattle’s office market. The region’s pool of tech talent is depleted, according to Savills. Tech sector employment in Washington State spiked by 10.9 percent during 2016 — triple the 3.1 percent gain in New York State, and well above the 4.1 percent increase in California. Amazon faces substantial local competition for talent as competitors such as Oracle significantly ramp up their local headcount.

Amazon estimates it will hire 50,000 people in its second location and will need 5 to 6 million square feet of space.

To view Savills’ full report, click here.