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Portland’s office market experienced a mixture of new deliveries and a few high-profile move-outs in 2018 that contributed to a bubble of oversupply, according to year-end data.

Annual absorption in 2018 was negative for the first time since 2009, according to Jones Lang LaSalle, as more supply was added to the market than was absorbed by new leases.

鈥淚n 2018, we saw a good amount of deliveries at the same time as we saw a couple of larger tenants either retrench or (try) to operationalize efficiency and (move) to suburban locations,鈥� said Patricia Raicht, senior vice president for research at JLL.

So far, the supply has had no apparent impact on lease rates. Average asking rents in Portland’s core rose 8.8 percent to $36.85 per square foot, according to JLL.

Demand remains strong, particularly among companies looking for a lower-cost alternative to the California and Seattle tech hubs, Raicht said.

鈥淲e continue to see interest from other West Coast markets that are looking for an alternative, and Portland stacks up well compared to those and will continue to,鈥� she said.

Tenants that vacated significant office space last year included Wells Fargo, which moved many of its employees from downtown’s Wells Fargo Center to Washington County; Jive Software, which was purchased by Aurea and closed; and The Art Institute, which closed.

Vacancies rose to 13.1 percent in the fourth quarter, according to JLL. Office sales reached almost $1.2 billion in 2018.

Several significant leases were signed, including Genentech taking 61,990 square feet on three floors of the Lloyd Center Tower from American Assets Trust, and Vacasa leasing 60,152 square feet from Security Properties in the Pearl District’s Heartline Building, according to Kidder Mathews.

The largest sale was the Moda Tower for $176.25 million to Unico Properties and ARA.

Nike added 412,000 square feet with construction of Building A at the company’s Beaverton headquarters, Kidder Mathews reported.

The office construction pipeline has slowed, suggesting the fourth-quarter supply glut will ease. This year’s largest expected deliveries include District Office from Urban Development + Partners and Beam Development, which will bring about 72,000 square feet of office space to market; and 7 S.E. Stark from Harsch Investment Properties, which will have about 70,000 square feet of office space.

In 2020, major anticipated deliveries include 250 Taylor for NW Natural, and the Press Blocks from Urban Renaissance Group and Security Properties, with approximately 135,000 square feet of office space in Goose Hollow.