St. Louis Office Market
Absorption in the second quarter of 2024 totaled negative 283,619 SF. This was a retraction from the fourth quarter of 2023, which realized the largest quarter of net absorption during the previous three years. Net absorption during the past four quarters totaled negative 13,575 SF. The non-owner-occupied construction pipeline has trended downward since the first quarter of 2023 due to recent deliveries and sharply decelerating new starts. There are currently 41,000 SF under construction. Vacancy increased 40 basis points to 14.9% during the quarter. Vacancy is expected to increase to 15.0% as the market continues to recalibrate. Asking rental rate growth for the overall market year over year has been nonexistent, totaling negative 0.9%.
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St. Louis Industrial Market
Net absorption in the second quarter of 2024 totaled 637,424 SF. Total net absorption during the past four quarters was 644,786 SF. The market is recalibrating as the economy slows and construction deliveries outpace net absorption, reversing the trend of the last two years. The 2.2-million-SF construction pipeline has trended downward over the past three quarters but is expected to accelerate towards 3.0 million SF in the next four quarters. Vacancy remained flat at 5.3% during the quarter but increased 60 basis points over the past four quarters as deliveries outpaced absorption. Asking rental rate growth for the overall market year over year has been nonexistent, totaling negative 0.2%.
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