Anyone looking for office space in Salt Lake Valley would be hard pressed to find any.
At a 6.6 percent vacancy rate, the area is considered totally occupied even though the area has 15 million square feet of office space, according to Greg Gunn, associate broker with Consolidated Realty, in a review of the office vacancy situation in the Salt Lake Valley. With some people on the move at all times, 5 percent is considered totally occupied, he said."This is the first in 20 years that I can remember the vacancy rate being so low," he said, which is an indication of the vibrant economy in the valley. For example, since 1988, the vacancy rate has dropped 70 percent.
In the central business district from North Temple to 600 South and 200 East to 200 West, the only building under construction is 150,000 square feet for Zions Securities, the real estate arm of The Church of Jesus Christ of Latter-day Saints, at Social Hall Avenue and 200 East.
Part of the this building has been leased to the Internal Revenue Service and part will be leased to an unnamed tenant, said Gunn. Completion is set for 1996.
In Class A space, such as that in the One Utah Center, Key Bank Tower and the Eagle Gate Tower, there is only 4 percent vacancy. Even though the American Stores headquarters is under construction at Main Street and 300 South, the 570,000 square feet in the 24-story building will be used mainly by the company.
Gunn said because American Stores obtained some money from the Redevelopment Agency of Salt Lake City, the company can lease only 30 percent of its available office space until 2008 so it doesn't compete unfairly with other nearby Class A office space.
In Class B space, such as the older and smaller buildings where rents are $12-$13 per square foot, there is a 6 percent vacancy rate, which has dropped from 22 percent in recent years.
Once with 20 percent vacancy rate, Class C office space, which is located in the older buildings of the central business district, now has a vacancy rate in the mid-teens, Gunn said.
In the perimeter around the Central Business District, there is no new construction, Gunn said, and after a time when more offices moved out than moved in, the vacancy rate is leveling off.
One of the biggest buildings in Salt Lake County, the Salt Lake Hardware Building, recently leased 50,000 square feet to Certified Vacations, and other space inside the building is being remodeled as tenants sign leases.
The office space situation in the suburbs is not much better than in Salt Lake City, Gunn said, with the vacancy rate for Class A office space at 2.9 percent; Class B at 3.7 percent and Class C at 9 percent.
About 2.7 million square feet of office space is being planned or under construction in the suburbs, Gunn said.