The city of Boston has absorbed 240,000 square feet of office space, increasing the year-over-year absorption rate to 765,000 square feet while reducing the vacancy rate to 11.2 percent, according to a quarterly report from Lincoln Property Co.

The Seaport, Financial District and North Station led the push with a collective 265,000 square feet of absorption, according to LPC.

But as Banker & Tradesman has reported, there are questions about the viability of the Seaport submarket, especially if some tenants focus their search to similar brick and beam buildings across the channel in "the more economical" South Station market, according to LPC. Similar properties in that submarket are priced at $28.90 per square foot, about $5 less than the Seaport.

Notable changes have occurred in the Class A and B markets. With Class A asking rates commanding $47.63 per square foot and just a 10.8 percent vacancy, the Boston market remains tight. As a result, tenants are eyeing Class B space, which absorbed 245,000 square feet and broke through the $30 per square-foot threshold. Continued demand for Class B office space is anticipated as tenants consider "relocating-in" from suburban locations to meet the demands of a younger workforce, according to LPC. Isobar, formerly of Watertown, recently announced they will relocate to 1 South Station, occupying 34,500 square feet, another example of firms relocating-in.

The Class A market remains healthy, with neutral quarterly absorption and total availability down to 14.4 percent, the report states. A year ago, the market posted negative 864,500 square feet of absorption for the prior 12-month period. Fast forward to the current situation, and the market has rebounded, absorbing 160,000 square feet over the past 12 months. Asking rates averaged $47.63 per square foot, more than 5 percent higher than at the close of 2011.