A direct correlation exists between the U.S. unemployment rate and office vacancies. According to recent data from the Bureau of Labor Statistics (BLS), this doesn’t bode well for the commercial sector. In March, the unemployment rate rose from 8.1% to 8.5%, according to the BLS. Over the past 12 months, the number of unemployed persons has grown by about 5.3 million, and the unemployment rate has risen by 3.4%. Since the beginning of the recession in December 2007, 5.1 million jobs have been lost, with almost two-thirds — 3.3 million — of the decrease occurring in the last five months, according to data from the U.S. Department of Labor.

Therefore, predictions of near-record vacancies and flat rental rates for 2009 come as no surprise. 2009 is expected to be a challenging year for commercial building owners, even more so than industrial building owners. In addition, in 2009 the completion of office buildings in formerly booming areas will add two percentage points to the national office vacancy rate, which is expected to total 16.5% by the end of the year, according to Grubb & Ellis, Santa Ana, Calif.