REAL ESTATE NOTES
OKC office leases continue to soften
Oklahoma City’s market for leased office space softened further in the third quarter, with net addition — or negative net absorption in realty language — of 301,722 square feet of space being offered for rent, according to NAI Sullivan Group. It was the second successive quarter of negative absorption, the firm reported.
“We cannot find the last time that occurred,” CEO Bob Sullivan said. “The continued pullback in the oil and gas industry is the obvious reason for the soft market, but additional contributing factors are the uncertainty of the federal government, the Oklahoma state budget crisis, and possible uncertainty over Congress making policy.”
The average lease rates for Class A properties was $22.47 per square foot per year, up from $22.38 in the second quarter. The Class B rate was $16.68, virtually flat from $16.66; and the Class C rate was $13.74, up from $13.51, the firm said.
Study shows renters are cost-burdened
A study by San Francisco-based Apartment List, an online apartment rental marketplace, shows that 45.3 percent of Oklahoma City renters were cost-burdened in 2016, meaning they spent 30 percent or more of their income on rent. That made the city No. 17 for affordability out of the nation’s top 100 largest metro areas.
In addition, the study — downloadable at apartmentlist.com/ rentonomics/ cost-burdened-renters-2017 — found that 22.3 percent of Oklahoma City renters were severely cost-burdened in 2016, spending 50 percent or more of their income on rent, Apartment List said.
The firm said affordability is determined by both rent and income, and that from 2005 to 2016, rents in Oklahoma City increased by 11.6 percent while renter income increased by 13.7 percent.
Nationally last year, 49.7 percent of renters were cost-burdened, the lowest level since 2008, due to growth in renter income outpacing rent increases from an increase in high-income renters delaying homeownership and a decrease in low-income renters, who may be living with family or pushed into cheaper markets.
Utilities Department earns Gold Award
The Oklahoma City Utilities Department received the Gold Award for Excellence in Utility Management from the Association of Municipal Water Agencies during its recent national convention.
To receive the award, the department had to demonstrate it meets or exceeds industry requirements in sustainability, enterprise resiliency, customer service, financial management, employee engagement and other areas.
It was the first time that the Utilities Department, with 1.2 million customers, applied for the Gold Award, which was given to only three municipal water utilities this year.
Clarification
A photo of the University of Oklahoma College of Medicine Academic Office Building that ran in this space on Nov. 4 was not properly credited. Randy Alvarado took the photo for Bockus Payne Architecture and it was provided to The Oklahoman by Manhattan Construction Group.