Bellingham’s commercial real estate vacancies decline, though downtown bucks the trend
Bellingham’s commercial real estate market had a hopeful decrease in vacancies in the third quarter of 2024, although downtown Bellingham did not follow the trend, according to a real estate report by Ryan Martin, co-owner and broker at Pacific Continental Realty, LLC.
“During the third quarter of 2024, the commercial real estate market displayed notable resilience, with vacancy rates declining across all major sectors,” Martin said.
Bellingham’s office space vacancy rates dropped from 4.62% to 4.05% compared to previous quarter. Industrial property vacancy rates also dropped from 2.49% to 2.06%. Retail space vacancy had a smaller decrease, from 3.14% to 3.07%.
Downtown Bellingham did not follow these hopeful decreases but had rates jump in the third quarter.
“However, not all areas shared equally in this positive trend. Downtown Bellingham emerged as a notable exception, where the office space vacancy rate soared to 8.18%, more than double the city’s average. Retail spaces downtown experienced even greater strain, with a vacancy rate of 8.39%, nearly three times the citywide average. This divergence highlights ongoing challenges in the downtown core, which has struggled to attract businesses and tenants despite the broader market improvements,” Martin wrote.
As Bellingham’s retail space vacancy rate slightly dropped, the cost of retail space increased. The average rent for retail space in Bellingham was $19.03 per square foot in the third quarter, compared to $18.57 in the second quarter.
Prices and vacancy rates fluctuated based on location.
“As with the office sector, the Meridian Corridor experienced the greatest reduction in vacancy rates, while downtown Bellingham continued to face challenges, with retail vacancies climbing. Meanwhile, Bellis Fair Mall, a major retail hub, remained largely unchanged throughout the quarter, with stable occupancy levels,” Martin wrote.
“In summary, while Bellingham’s commercial real estate market showed overall improvement in the third quarter of 2024, downtown areas — particularly in the office and retail sectors — remain areas of concern,” Martin wrote in the report.
Martin creates his quarterly real estate reports by using 26 spreadsheets of statistical local data, sorting the data by real estate categories and updating the data and vacancy rates regularly.
This story was originally published October 22, 2024 at 5:00 AM.
