With the years-long, red hot residential real estate market finally cooling off a bit in the Puget Sound region, it makes sense to wonder if any changes are on the horizon for the Eastside’s commercial real estate market.

At first glance, the loosening vacancy rate for Class A office space in Bellevue’s central business district — from 5.2 percent to 7.9 percent, according to third-quarter data found in Colliers International’s Bellevue Skyline Review — might give you reason to celebrate.

But Paul Sweeney, principal and co-founder of the Broderick Group, said these numbers can be misleading.

“Vacancy reflects what’s (currently unoccupied), not what is committed, and much of that is space that was vacated (but) already leased by other tenants,” Sweeney explained. For example, he pointed to WeWork, which has leased space in the Summit Building once occupied by Puget Sound Energy. “Even though it shows (up) as vacant and leads to a higher (vacancy rate, it is) not available to the market.”

Bellevue DowntownIn fact, office space is in such high demand that the average asking Class A rent in downtown Bellevue surpassed $51 per square foot for the first time ever.

Expansion plans by the likes of Google and Amazon have made it almost impossible for smaller businesses to find adequate office space. Of the 2.9 million square feet of Eastside office space sought by companies, 70 percent of the companies looking to land leases for that space are technology companies, according to Colliers International’s third-quarter Puget Sound Office Market Report.

Where’s the relief?

Vancouver-based Onni Group and local developer Skanska recently announced new developments that will add more than 1 million square feet of space in downtown Bellevue.

In Redmond, Capstone Partners revised its vision for the Esterra Park development with plans to develop of 235,000 square feet of office space.

SECO Development recently completed the Southport business park, which offers more than 712,000 square feet of Class A office space inside three nine-story buildings in Renton. The developer plans to entice future tenants by offering a water taxi service that, by 2020, would transport people to and from Bellevue, Renton, and Seattle.

Still, most of these projects are on the distant horizon. What will the commercial real estate forecast look like this year?

According to Sweeney, expect more of the same — namely, low inventory.

“There is simply not enough available office space to keep up with the surprising amount of demand that continues to surface,” he said. “Spiraling land, materials, and construction costs won’t help the cause as developers need rental rates well in excess of current rates to justify new development. And, in general, we all grossly underestimated the amount of new product that would need to be delivered to meet space demand (through to 2022).”

And in response to the record-setting Class A rental rate downtown Bellevue saw in the third quarter, Sweeney said the worst is yet to come.

“While tenants may be complaining about the huge rate increases we’ve seen in the past few years, a year from now they will think today’s rental rates are a bargain,” he said.