Real Estate News

National Office Absorption Turns Negative With More Dark Clouds On Horizon

(SANTA ANA, CA) - Just when you thought the national office market might be headed for some stabilization signs, the U.S. Bureau of Labor comes up with more discouraging news.

grubb_ellis_labor_chart_9-9-08.JPGIn August, the most recently audited month, the labor market shed 84,000 net payroll jobs, bringing year-to-date losses to 605,000, notes Bob Bach, Senior Vice President, Chief Economist, Grubb & Ellis Co.

Bach says in the key office-using sectors of information, finance, and professional and business services, losses this year total 352,000 jobs.  Nearly two-thirds of that total is in temporary help services, a category with "a tenuous link to demand for office space," Bach says. 


Bob Bach

"That leaves full-time office jobs down by 128,000, which translates into potential negative net absorption of 20 to 25 million sf.  Absorption turned negative in the second quarter at -3.1 million sf, suggesting more losses may be coming."

Bach also used Grubb & Ellis research data to prepare his findings.  His September outlook is expected to arrive by mid-October.
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