The owners of the office complex called Retro Lodge are continuing bank negotiations in an effort to prevent the property's sale. The $2.5 million loan balance is now several months past due, which led Bank of America to schedule trustee sales at least twice this month. But developer Heller Pacific and partners haven't given up on trying to get a loan extension after converting a former downtown Travelodge into one of the city's most creative adaptive-reuse projects, a block away from Sacramento City Hall. The bank agreed to postpone a sale scheduled for Thursday while the partners are deep in talks with them. The project, which received no public subsidies, began taking tenants in 2008

Sacramento's office space market will continue to favor tenants as vacancy rates increase and businesses consolidate existing office space. That combination is allowing prospective tenants to negotiate deals that may not have been possible before the economic downturn. According to Reid Boggiano of Sacramento Tenant Advisors, companies looking for class B or C office space will be able to get deals and allowances that weren't possible during the economic boom. "It hasn’t been this much of a tenant’s market in Sacramento for a good many years," said Boggiano. "Right now we are negotiating rent reductions and generous tenant improvement allowances that we wouldn't have imagined only a few

The Sacramento office market experienced a year-over-year decline of up to 13 percent for key submarkets as landlords began lowering prices and offering incentives in order to attract tenants. In addition with businesses downsizing or closing offices altogether, more space has come on the market which has helped to drive down prices even further. The following section shows the year-over-year declines for the average price of space in key Sacramento submarkets. (The price range factors in specific location and class of space) : Downtown - 2009 rates are 8 to 11 percent lower El Dorado Hills - 2009 rates are 7 to 11 percent lower Elk Grove - 2009 rates are 8 to 11 percent lower Highway