A new report by Lee & Associates of Maryland revealed that office vacancy in the popular Columbia, Md., region dropped from 12.8 percent to 12.3 percent from the last quarter of 2020 to the first quarter of 2021 on the strength of a positive net absorption.
During the first three months of 2021, approximately 120,000 square feet of space was absorbed and nearly 400,000 square feet is currently under construction.
“Our location between Baltimore and Washington has always helped this region’s ability to be resilient,” Bill Harrison, senior vice president at Lee & Associates of Maryland, told Commercial Observer. “This market benefits by a number of factors, including federal government spending, a diverse and well-educated population and proximity to a large portion of the U S population within a four-hour drive.”
The report showed that about 214,000 square feet of space was leased in Q1, with the average asking rent rising to $25.50 per square foot, after finishing 2020 at $25.31 per square foot.
“The suburbs continue to benefit from companies fleeing major urban areas, as well as those establishing a hub-and-spoke model that offers increased employee flexibility for workspaces,” Harrison said. Columbia remains a viable option for companies based on its equidistance from Baltimore and Washington, D.C., housing options and an incredible amenity base that includes a reimagined town center area.”
The largest lease signed during Q1 was Rekor Systems taking 54,717 square feet at 6721 Columbia Gateway Drive.
Of those office buildings under construction, the largest are the 263,000-square-foot 11100 Johns Hopkins Road and the 109,000-square-foot 8130 Maple Lawn Boulevard.
Additionally, two significant investment sales were completed in Columbia in the first quarter: Thomas Park Investment acquired 5005 Signal Bell Lane in Clarksville for $8.1 million, and Longfield Realty Holdings sold 11115-11145 Stratfield Court in Marriottsville for $1.65 million.
“We are optimistic about the later parts of 2021, due to the continued growth of e-commerce greatly impacting the industrial market,” Harrison said. “In addition, the availability of vaccines should support some level of a return to the office work environment, eventually benefiting the office market as well.”