According to Bob Bach, national director, market analysis at Northbrook, IL-based Grubb & Ellis Co., the average office lease term climbed a bit in 2004 as strong profit growth gave tenants the confidence to sign long-term leases instead of short-term extensions. “Blend and extend” was a popular option where landlords reduced the rent remaining on the last year or two of a long-term lease if the tenant would sign a new long-term lease, thereby securing a steady income stream for the landlord and an immediate rent discount for the tenant. Job creation and business confidence should improve in 2005, generating more long-term lease signings.This market update information was provided by Grubb & Ellis Co. (www.grubb-ellis.com).
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