by Dan Rafter
It’s a simple formula: As the unemployment rate dips, vacancy rates in the office sector dip. And that’s what is happening now in the St. Louis market, according to the latest research from Colliers International.
The U.S. Bureau of Labor Statistics reports that the unemployment rate in St. Louis had fallen to 5.6 percent at the end of November of last year. That’s down from 7 percent in June of 2014.
That dip has corresponded with a decline in office vacancies in the St. Louis market, too. Colliers reported that by the end of 2014, overall office vacancy in this market fell to 10.79 percent. That’s down 1.01 percent from the end of 2013.
That drop might seem like much. But vacancy rates here are heading in the right direction.
Rental rates, too, are moving in the right direction, according to Colliers. The company reported that the average asking rental rate for office space in the region stood at $17.58 a square foot at the end of 2014. That is up from $17.51 a square foot in the third quarter. Again, that’s not a huge increase, but the numbers are rising, which is positive news for the market.
Not all of St. Louis’ submarkets are performing equally well. Colliers said that the submarkets that saw the greatest declines in office vacancies last year were the city’s CBD, Clayton, Midtown and West County.