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As of the end of the first quarter of 2019, the vacancy rate for Class A and Class B office/medical properties was up 90 basis points quarter-over-quarter to 16.8%, and an increase of 220 basis points year-over-year. As a point of comparison, the San Antonio area’s overall office vacancy rate for Class A space registered at 12.3% as of Q1 2019, and Class B a tighter 9.7%. Net absorption slowed at negative -94,000 sq. ft., with Class A space representing negative -46,000 sq. ft. and Class B space totaling -47,000 sq. ft. The previous run of overall positive net absorption lasted five consecutive quarters, Q3 2017 through Q3 2018.
Groundbreaking on two RidgeWood Park Buildings
Worth & Associates and South Texas’s largest orthopedic practice TSAOG broke ground on an office building, RidgeWood Plaza II, and a medical facility, RidgeWood Orthopedic Center. RidgeWood Plaza II will be a 123,000 sq. ft., four-story, Class A office building and the orthopedic center will be a 97,000 sq. ft., three-story medical facility. Both will share a three-story parking garage and a landscaped courtyard once completed by the summer of 2020.
The Children’s Hospital of San Antonio sold
Harrison Street Real Estate Capital LLC has bought the Children’s Hospital of San Antonio Health Pavilion in Stone Oak, located at 1434 East Sonterra Boulevard adjacent to the 242-bed Methodist Stone Oak Hospital and near the 362-bed North Central Baptist Hospital. Christus Santa Rosa Health System occupies over 80% of the property, and Children’s Hospital of San Antonio is the anchor tenant. The brand new, 57,250-sq.-ft. medical office building was 100% leased at the time of sale by Seavest Healthcare Properties LLC.
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