Several Birmingham submarkets saw improvement in the overall office occupancy rate during the second quarter.

Several Birmingham office submarkets see improvement in mid-year report.

According to Cushman & Wakefield EGS Commercial Real Estate‘s 2015 Mid-Year Market Review, the vacancy rate in Birmingham’s Central Business District fell from 12.3 percent during the first quarter to 11.9 percent at the end of the second. This is especially positive knowing that Infinity Property & Casualty’s move to the 120,493-square-foot former Birmingham News headquarters downtown will happen sometime during the first half of 2016.

“While overall vacancy reported a slight increase during the second quarter, Birmingham’s office market remains stable,” the report said. “Investor sales activity continues to increase specifically with class A office buildings, indicating confidence in the market as a whole. Additionally, a number of hotel, multifamily and mixed-use development projects are currently underway in Birmingham’s CBD, increasing excitement and momentum for the commercial real estate market as a whole.”

The Birmingham metro vacancy rate was 12 percent (up 0.7 percent) during the second quarter.

The Midtown market in Birmingham ended the quarter with the lowest vacancy rate, at 8.1 percent, up slightly from 7.7 percent during quarter one.

The 280/Southern submarket had positive absorption of 27,398 square feet, dropping its vacancy rate from 11.3 to 10.8 percent.

Hoover/Riverchase saw the highest amount of vacated space (158,856 square feet), mostly due to the move of Surgical Care Affiliates to the Midtown district.

Overall, EGS expects Birmingham’s office market to remain on a slow and steady climb.

“It is expected that overall market activity will increase steadily throughout the second half,” the report said.

Bryan Davis is the research/media coordinator for the Alabama Center for Real Estate housed within the Culverhouse College of Commerce at the University of Alabama. He can be reached at 205-348-5416 or at bkdavis@culverhouse.ua.edu. The Alabama Center for Real Estate‘s core purpose is to advance the real estate industry in Alabama by providing relevant resources in the areas of research, education and outreach.