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The Journal Gazette

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Friday, October 06, 2017 1:00 am

Downtown office vacancy dwindling

SHERRY SLATER | The Journal Gazette

At a glance

The Zacher Co.'s 2017 Fort Wayne office space survey includes the following statistics about parts of the city as compared to 2016:

• Northeast had the highest vacancy rate at 24.58 percent, a 2 percent decrease

• Northwest had the highest increase – 41 percent – to 21.98 percent vacancy

• Southeast saw a 23 percent climb in vacancy to 11.69 percent

• Southwest's vacancy rate increased 5 percent to 15.45 percent

Demand for downtown office space is heating up as more people are moving downtown, according to a local commercial real estate agent who crunches the numbers.

Steve Zacher, who owns The Zacher Co., on Thursday released his firm's annual Fort Wayne office market survey.

The study showed a 24 percent decline in downtown office vacancy to 6.99 percent, the lowest in at least nine years and the lowest rate of five city segments.

Local officials have concentrated economic development efforts on downtown in recent years, citing the success of similar-sized cities that attracted and retained talent by reviving comatose city centers.

“There's a lot of really good momentum downtown that we've seen for a few years now,” Zacher said., citing deals announced in the past year.

SIRVA Inc. is moving its headquarters into the Indiana Michigan Power Center, 110 E. Wayne St., bringing more than 400 employees from its current location at the U.S. 30 and Kroemer Road intersection. The global relocation and moving services provider, which operates the Allied and NorthAmerican van line brands, signed a lease for 63,000 square feet of office space on six floors.

“That's really significant,” Zacher said, adding that he doesn't remember the last time such a large number of workers moved downtown at once.

Other downtown activities include a makeover for the eight-story Fifth Third Metro Center at 202 W. Berry St. and major developments planned for The Landing and Electric Works, formerly the General Electric campus. Each project includes additional office space.

Local office space is located in more areas than just downtown, however. Zacher's firm divides the remainder into quadrants.

The amount of office space available for lease or sale varies by district. Northeast is home to more than four times the amount of office space found in southeast, for example. Downtown, northwest and southwest offer similar totals that are midway between the northeast and southeast extremes. Percentages are based on the total available in each area.

Zacher described overall market conditions as stable.

Total office vacancy rates ticked up to 13.98 percent, a 1 percent increase from last year. That follows a mostly downward trend from 2009's 18.81 percent.