Office occupancy shows signs of recovery in Baltimore area

June 25, 1994|By Timothy J. Mullaney | Timothy J. Mullaney,Sun Staff Writer

The office vacancy rate in the Baltimore area fell by more than one-half of one percent during the first half of this year as commercial real estate continued to emerge from its crippling depression of the early 1990s, according to a new report from a downtown brokerage firm.

Casey & Associates said tenants have moved into 332,000 more square feet of office space than they have vacated in the first half of the year. The gain is slightly more than the size of one average downtown Baltimore office tower.

The regional vacancy rate fell to 16.48 percent at mid-year from 17.2 percent at the end of 1993, said Thomas C. Jackson, Casey's research director.

Casey President J. Joseph Casey said most of the gains came in the first quarter. He said that the market slowed sharply after the Federal Reserve began to push interest rates higher but that there is still a much larger number of companies shopping for office space than there was a year ago, a sign that companies are feeling more confident of the economic expansion.

"I expect to finish the year substantially higher [in market activity] than in 1993," he said.

"We're going to see it maybe not as good as the first quarter but substantially better than the second quarter."

Nearly all the good news came from Baltimore County, where a series of small to mid-size leases righted a market that came through most of the recession in better shape than the rest of metropolitan Baltimore before going through major consolidations in 1993.

The county picked up more than 305,000 square feet of office occupancy.

Mr. Jackson said Baltimore County's biggest gains were in the Towson Commons mixed-use complex on York Road, which struggled after its 1992 opening but has now achieved nearly full occupancy. Towson Commons' 190,000-square-foot office tower landed a 38,000-square-foot lease from American Telephone & Telegraph Corp. and a 25,000-square-foot expansion from existing tenant Amoco Corp. in recent months.

Amoco is a partner in the joint venture that developed Towson Commons.

Another major lease was a 45,000-square-foot deal by AmTote International Inc., which moved out of a nearby building to the Executive Plaza complex across from the Hunt Valley Mall, Mr. Jackson said.

The downtown office market showed only minor changes, with total occupancy gaining by only 11,000 square feet.

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