Bellevue has the 10th most expensive skyline of office buildings in the country, according to commercial real estate company JLL.
Annual average rents in Bellevue are $46.77 per square foot, which averaged more than Seattle’s $43.40 per square foot. New York City topped the list with an average price of $87.90 per square foot.
Last year, analysts at JLL were concerned Bellevue’s office space supply was overbuilt, due to Expedia’s departure and three high-rise office buildings coming online. But now, JLL Managing Director J.J. Shephard said much of that space is taken.
“There’s not large blocks of space right now,” he said of Bellevue’s outlook. “If you’re a tenant that’s looking for multiple floors, it’s virtually impossible to find right now.”
Instead of a 10 percent vacancy rate, Bellevue sits at a 7.6 percent vacancy rate. At 5.4 percent, direct vacancy in Seattle’s skyline is the lowest since 2000, according to JLL.
But in Seattle, there is 2.2 million square feet of supply on the way, like the F5 Tower in the city's downtown core.
Building like that is not happening in Bellevue because developers were spooked last year and it takes three to four years to build a building from start to finish, said Shephard.
“A year ago, people were really nervous about the Eastside, especially in downtown Bellevue,” said Shephard. “It takes a long time for buildings to be built, and so we don’t see anything that’s in the pipeline that’s going to alleviate that strain in the marketplace.”
In fact, he believes Expedia’s departure could be a positive.
“With the square footage at Expedia that’s going to be vacating, that’s not really going to happen until 2020. That’s quite a ways out. We think that’s going to be a great vacancy for the market,” he said.
Shephard added developers are aggressively looking for future commercial sites on the Eastside.