The Puget Sound office market continued to strengthen in Q3 2012, with declining vacancy rates and increasing rental rates. Employment growth at tech companies like Amazon fueled a drop in vacancy to 15.6% while average direct rents rose to $28.63/SF. Several large investment sales occurred, including Amazon's planned $1.16 billion purchase of its Seattle headquarters. Absorption was positive at 342,411 SF, bringing the YTD total to over 2 million SF. The market forecast calls for further declines in vacancy and rental rate growth, especially for quality Class A space downtown.