The Greater Des Moines commercial real estate market appears to have bottomed out, but tenants will continue negotiating less expensive leases on office, retail and industrial spaces as the economy improves, brokers with CB Richard Ellis/Hubbell Commercial (CBRE) said last week.

“At least we know the firing has stopped, and we’re looking for substantial hiring to begin,” said Kyle Gamble, managing director of CBRE, speaking at the West Des Moines-based brokerage’s 2011 Real Estate Market Survey presentation on Feb. 24.

In 2010, a net 98,389 square feet of competitive Class B office space was leased in the central business district as a number of smaller tenants located there. The downtown submarket’s competitive Class A vacancy rate climbed to 26.1 percent in January 2011, following the relocations of Aviva USA and Wellmark Blue Cross and Blue Shield to owner-occupied spaces.

In the western suburbs, the competitive office occupancy rate stood at 83.6 percent at the beginning of 2011, a year-over-year improvement of 4.3 percentage points.

“This success is mostly attributed to landlords keeping current tenants in place by offering reduced net effective rents on renewals, or tenants renegotiating leasing extension opportunities,” said Jan Berg, a CBRE vice president.

Tyler Dingel, a CBRE senior associate, said he expects increased demand from local and regional retailers this year as building owners continue to offer concessions to attract and retain tenants.

“It will remain a tenant’s market as landlords continue to compete for limited activity, until occupancy rates return to a more stabilized level,” Dingel said.

The overall occupancy rate of area shopping malls improved to 91 percent in January 2011, from 88 percent a year earlier, and occupancies in neighborhood strip centers fell slightly to 75 percent. The big-box retail occupancy rate rose 0.3 percentage point to 95.4 percent. The industrial warehouse vacancy rate increased to 10.5 percent.

The CBRE survey was compiled by Frandson & Associates LC.