HONOLULU (HawaiiNewsNow) - No matter how well your employer is doing, don't be surprised if the company downsizes its office footprint, leaving you with less work space.
In a report this week on the Honolulu office market, Hawaii Commercial Real Estate LLC reports 132,000 square feet of positive absorption in 2012 "will be nearly offset by about 130,000 square feet of impending downsizing in 2012, much of it from leases signed in 2012 that take effect in 2013."
Tenants taking smaller space, either at their current locations or while moving to different buildings, include Farmers, Deloitte, the defense contractor BAE and two local law firms.
"This has been a trend in office management for some years," Mike Hamasu of Colliers Hawaii said in a recent appearance on HawaiiNewsNow. "I don't think economic recovery will stop it."
Bishop Street Commercial says 1 million square feet of office space is vacant, mostly downtown, and one reason is that the average employee occupies 12 square feet today, down from 200 square feet 20 years ago.
Office vacancy on Oahu is about 13 percent. A year ago it was about 14 percent. Asking rents are down slightly, offset by slightly higher average operating costs.
Actual vacancy rates can vary widely from one office building to the next. HCRE says Davies Pacific Center has 22 percent vacancy while the Pacific Guardian Center is at 13 percent and Central Pacific Plaza is at 4 percent.
HCRE, Colliers Hawaii, and CBRE Hawaii have all recently predicted improvement in the market as a result of the overall economic recovery and, more specifically, the restart of rail and the growth in the solar energy industry. They have all, however, also noted that Congressional talk of cutting federal spending is a wild card that could offset growth from other trends.