A new report from GlobeSt.com suggests that whether DC landlords will admit it or not, a certain percentage of the city's buildings have become, or are becoming obsolete. "The rapid obsolescence of B and C properties, some of which cannot be cured, is surprising," said Newmark Grubb Knight Frank's Senior Managing Director of Research Greg Leisch. "In my 45-year career I have never seen such rapid obsolescence." Obsolete, in current vernacular, indicates that a property lacks robust amenities or an urban location, are not convenient to mass transit, or have smaller floor plates or an extensive glass line.
NGKF are still preparing their findings for a full report and, according to GlobeSt.com, will reveal them in an upcoming white paper. An excerpt from the report follows:
"There has always been a difference between best-in-class office product and the rest of the market," Leisch tells GlobeSt.com. "Now, though, the differences have become more profound."
One telling statistic, Paul says, is that the share of office leasing by Class A offices has really taken off since the recession.
According to the report, "Since the start of 2008, Class A office properties in the Washington metro area have totaled 18.6 million square feet of net absorption, while Class B and C properties have experienced negative 13.8 million square feet of absorption, with each year reflecting positive net new demand for Class A space and a loss of occupancy in the balance of the market."
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