Roanoke office market occupancy remained at 86 percent last year

Published January 23, 2015 by Robert Powell, III

An survey released Friday by Poe & Cronk Real Estate Group shows the overall Roanoke office market occupancy rate remained at 86 percent in 2014, the same percentage as the year before.

The Roanoke-based company’s 28th annual office market survey found occupancy and rental rates in all three of the area's major office sub-markets also remain unchanged.

Poe & Cronk said its data could signal a relative floor for occupancy and rental rates in the area and added that the economic outlook for this year is optimistic

As job growth continues to improve in the Roanoke Valley, many employers have limited room in their existing space for new employees, the company said.

As this capacity is absorbed and the business environment continues to improve, Poe & Cronk expects employers to seek new office space this year.

“If this growth persists, it should be strong enough that we should see office occupancy rates increase,” Poe & Cronk associate Bryan Musselwhite said in a statement.

About 57,000 square feet of office space was absorbed by new owners last year. Roanoke’s 86 percent occupancy rate was higher than the national average of 83 percent reported by the national real estate research firm REIS Inc.

REIS believes rents grew nationally by roughly 2.6 percent last year, and it expects rent growth to rise this year.

Poe & Cronk has conducted its office market survey annually since 1987. The latest survey includess data covering more than 100 nongovernmental office buildings measuring 10,000 square feet or more.