There is over 350,000 square feet of sublease space currently available on the market. The actual square footage is probably higher since sublease space is often not marketed as aggressively as landlords market space for lease. It is our projection that the supply of sublease space will continue to increase into the next year as major national corporations continue cutbacks. The increasing amount of sublease space compounds the problem of a softening market as sublease space is usually offered at a discounted rate. As the amount of sublease space increases, tenants with space available for sublease are having to compete against each other.
Landlords then have to compete against discounted space in their own building.
Rental rate discounts on sublease space range between 15 to 50 percent. The East Memphis submarket has a total of 7,568,780 square feet of Class A and Class B office space. The combined current occupancy is 87.95 percent. The total amount of space available is 912,037 square feet in East Memphis. There is approximately 186,075 square feet of sublease space currently on the market in East Memphis.