"It's been tough," says David Gurry, broker for the Horton's real estate company, CB Richard Ellis. "The market isn't working in our favor right now." (The Horton needs to replace city government offices that are leaving for the Key Tower.)
The vacancy rate in downtown office spaces is almost 9.6 percent these days, up from last year's 1.01 percent vacancy rate. Real estate prices, which soared last year due to the dot-com rush, have also started to drop. According to CB Richard Ellis, average rent rates per square foot have fallen to $33.72 from last year's $35.54. "Were definitely concerned," says Republican King County Council Member Rob McKenna, who attended the Economic Council meeting.
A walk downtown confirms the drop. "For Lease" signs--seven of them--dot Third Avenue between Pike and Cherry Streets. The empty spaces range from dingy storefronts to the newly constructed glass Millennium Tower on Columbia Street and Second Avenue.
Downtown businesses have also noticed the rising vacancy rates. "We lost a lot when the tenants moved out of the Horton Building," says Erik Hamby, a valet parking attendant at the Cherry Street Garage across the street from the Dexter Horton Building. "Supposedly, tenants were moving in. That was six months ago at least. We used to have to shut this place down at noon. Now there are plenty of spots open. Our revenue has been cut in half."
