View Full Version : OKC Office Vacancy



ljbab728
02-04-2015, 11:45 PM
This is really an amazing statistic.

Oil runs in the streets of downtown Oklahoma City's booming office market | News OK (http://newsok.com/oil-runs-in-the-streets-of-downtown-oklahoma-citys-booming-office-market/article/5390669)



Flash “No” over downtown Oklahoma City’s best office buildings, for “No Vacancy” — but hurry.

No one knows how long it will last.



Price Edwards & Co. reported Wednesday that downtown Class A office space ended 2014 with a vacancy of 0.7 percent.

“We’re basically out,” said Craig Tucker, the firm’s managing broker and an office specialist.

bombermwc
02-05-2015, 07:49 AM
You hear this and then you hear people talking about why not to build another tower right now. I just don't ever get developers......

Would you classify OG&E's space as A or B? There isn't a lot of it so it's not going to saturate the market or anything. We got lucky as all hell when Devon's got swallowed up by Continental.

Urbanized
02-05-2015, 08:29 AM
The elephant in the room is Sandridge.

Pete
02-05-2015, 08:30 AM
I think Continental would snap up the SandRidge properties were some or all to become available.

Urbanized
02-05-2015, 08:32 AM
Yeah my thoughts as well. Which might domino their current space(es), of course.

Just the facts
02-05-2015, 02:29 PM
You hear this and then you hear people talking about why not to build another tower right now. I just don't ever get developers......

Would you classify OG&E's space as A or B? There isn't a lot of it so it's not going to saturate the market or anything. We got lucky as all hell when Devon's got swallowed up by Continental.

Technically it is neither since it is owner-occupied. The A to C classification is determined by the properties ability to generate market-rate rental income. However, when OG&E moves it is possible it will come on the market as C (which makes it a prime candidate for residential conversion).

bombermwc
02-06-2015, 07:46 AM
C? I would have put it at least at B. The ability to get a particular rental rate depends on what the building has to offer. Anyone is going to gut the walls and rework the space, so the better question is what the infrastructure of the building has to offer. With renovations to restrooms/lobby/infra. the place could even hit A. I think that's a stretch, but do you really put it in the same spot as the FNC tower space???

ShadowStrings
02-06-2015, 08:32 AM
Forgive my ignorance, but what are the criteria for the different classifications of office space? I've seen people refer to the different classes a number of times the last couple years I've been reading OKCTalk, but I guess I don't really know exactly what makes something class A, B, or C.

hoya
02-06-2015, 10:52 AM
Forgive my ignorance, but what are the criteria for the different classifications of office space? I've seen people refer to the different classes a number of times the last couple years I've been reading OKCTalk, but I guess I don't really know exactly what makes something class A, B, or C.

There's no hard and fast definition. It's based upon what rental rates you can ask for.

Generally Class A has big big floor plates, lots of amenities. It's got all the modern stuff. The big companies lease Class A space.
Class B is somewhere in the middle.
Class C space is usually for smaller offices. A law firm with 9 or 10 employees will probably lease Class C space. First National tower is basically limited to Class C space, because the actual physical structure of the tower is seperated into a bunch of small offices.

Just the facts
02-06-2015, 11:12 AM
The classification is also very location specific. A class A building in one city might not be a class A building in another city, or even in a different part of the same city. OKC for example has like 6 sub-markets. A converted warehouse in north OKC wouldn't come close to the same rental rate as a converted warehouse in Bricktown, so wouldn't be classified the same even if they were identical in every other way.

NWOKCGuy
02-06-2015, 12:06 PM
That's true for every city. Location is part of the classification.

ljbab728
02-06-2015, 11:58 PM
An update to this story by Richard Mize.

Numbers between the lines help tell Oklahoma City's oily office market story | News OK (http://newsok.com/numbers-between-the-lines-help-tell-oklahoma-citys-oily-office-market-story/article/5391419)


Oil commanded the most attention in a story Thursday on the office market based on Price Edwards & Co.’s year-end summary, and some important numbers got washed out.
Class A vacancy fell from 9.3 percent at midyear to almost nothing, 0.7 percent, at year end, but overall vacancy barely budged, from 21.7 percent to 20.7 percent.

The important number, though, was 84.

“It should be noted that 84 percent of the vacant downtown space exists in buildings that were constructed in the 1920s and 1930s and nearly two-thirds of all the vacant space ... exists in one building — the First National Center,” Price Edwards reported. “That building’s dated systems and troubled ownership has virtually taken this building off the market for the past couple of years and any hope for new ownership and a revitalization of the project through a pending sale is now clouded by monetary claims from a partner in a previous ownership group. The point is, most of the available space downtown is vacant for a good reason and good space is nearly impossible to find (downtown).”