Cleveland Office Market
Direct space availability decreased significantly in the fourth quarter of 2024 by 160 basis points from the third quarter to 19.7%, representing 7.8 million SF. This is the lowest that direct space availability has been since the second quarter of 2022. Sublease space availability stayed at a flat 1.5%. The market accrued 160,328 SF of positive absorption in the fourth quarter of 2024, propelling the market out of the negative for a yearly total of 138,705 SF in net positive absorption. The market finished the year in the positive for the first time since 2019. The quarterly positive absorption caused the vacancy rate to dip by 30 basis points to 27.8%. For the year 2024, the vacancy rate came in at 23.1%. The Cleveland office market’s average asking rental rate decreased by $0.01/SF from the third quarter of 2024 to $19.96/SF in the fourth quarter. As a result, the 2024 year-to-date average asking rent total held steady at $19.96/SF.
Download Cleveland Office Market Report 4Q24Cleveland Industrial Market
The Cleveland industrial market gave back 168,558 SF of space in the third quarter. As a result of the small amount of negative absorption, vacancy increased by just 10 basis points to 4.1% from 4.0% in the previous quarter. Year-to-date vacancy for the first three quarters combined at 4.1% continued to remain well below the long-term average vacancy of 8.0%. Demand for industrial space rebounded in the third quarter of 2024. After the second quarter was under 1.0 million SF for the first time in the last 10 years, third quarter leasing activity ended at 1.7 million SF, up from 880,633 SF in the previous quarter. Industrial average asking rents for the first three quarters of 2024 grew by a combined 6.2% year-over-year, down 50 basis points from the first and second quarter of 2024’s growth rate. The average asking rent for the third quarter was $6.15/SF, down by $0.06/SF from the previous quarter, but still marked four straight quarters over $6.00/SF, and the fourth-highest asking rate in at least 20 years.