Commercial real estate services firm Grubb & Ellis forecasts the U.S. office market to have a “half-speed recovery” this year, according to the company’s 2011 Real Estate Forecast, released in January. Vacancy rates will drop from 2010’s 17.8% to 17%, net absorption will increase by 35 million square feet and Class A rents will rise by 0.4%. But these improvements are at about half the pace of typical economic recovery or growth cycles, according to the forecast. For instance, annual absorption ranged from 62 million to 89 million square feet during the mid-2000s.

Grubb & Ellis’ forecast also includes a metro office market strength analysis for 2011-2015. The metros that scored highest tend to be those with strong prospects for employment and population growth, plus expensive development sites that inhibit new construction. Not surprisingly, these metros are typically on the East and West coasts, with New York City and Washington D.C. leading the pack.

The implication for ULI members is that coastal markets will likely lead the recovery in the office sector. Here are Grubb & Ellis’ Top 10 office markets for 2011-2015, scored on a 0-to-100 scale based on 13 property, economic and demographic variables:

Rank

Metro

2011-2015 office strength score

1

New York City

77.7

2

Washington D.C.

77.4

3

Portland, OR

75.0

4

Boston

73.2

5

Los Angeles

71.5

6

San Diego

70.6

7t

San Francisco

69.7

7t

Oakland/East Bay

69.7

9

Raleigh/Durham, NC

65.0

10

Austin, TX

64.3

(Source: Grubb & Ellis.)