INDIANAPOLIS — Office vacancy rates in the Indianapolis metro area are trending downward; the current vacancy rate stands at 22.5%, according to real estate services firm JLL.
That’s an improvement from last year, which John Vandenbark, a managing director, says the company predicted would mark the bottom of the office downturn.
“Vacancy rates are one of those indicators that tell us where the market is headed, and this shows we’re moving in the right direction relative to a recovery,” Vandenbark.
The pandemic left many office buildings empty, but companies are slowly returning, and in some cases, expanding.
“Of the 90-some tenants in the market right now, over 50% of them are growing their footprint,” said Matt Waggoner, with JLL. “About 15% are shrinking, and the rest are stable.”
Experts say developments such as Bottleworks highlight what tenants are looking for: a mix of office, retail and residential that creates energy and attracts workers.
While other Midwest markets are still struggling, Indianapolis continues to draw interest from companies thanks to its business-friendly tax environment, affordable cost of living and strong talent pool.
“We’re in the center of the country, so it’s an easy place to get to,” Vandenbark said. “We have good talent, good companies.”
Much of the recent growth has been outside downtown, but JLL believes redevelopment projects like the Circle Centre Mall and the new Signia Hotel will help bring momentum back to the city’s core.
“Downtown leasing is stagnant right now,” Waggoner said. “But the outlook is much more positive than today’s activity.”
