Also sometimes called the base, base inventory or competitive inventory. The inventory represents those properties on which the market statistics are generated. Not all properties in a market are included in the inventory. While research departments may include these buildings in their databases in order to track available space in the buildings, they must be excluded from the competitive inventory and the statistical calculations and reports. Net Absorption is the net change in physically occupied space between the current measurement period and the last measurement period.
Net absorption can be either positive or negative.
The calculation of net absorption includes transactions that occur in sublease space as well as direct lease space. The vacancy rate is the amount of vacant space divided by the competitive building inventory. Vacant space is physically unoccupied, and it may or may not be available for lease or sublease. This is physical vacancy. It is not determined by whether or not a tenant is paying rent on the space.