The office market is being boosted by the strength of the technology sector
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The office market is being boosted by the strength of the technology sector.
Real estate firm Cushman & Wakefield says that the third quarter of 2017 saw strong fundamentals for the office market with stability nationwide for the past three months.
“More and more, the office market’s fortunes in 2017 are linked to the rise of the tech sector,” said Cushman & Wakefield’s Revathi Greenwood, Head of Research, Americas. “In 2016, Seattle was the only technology hub to rank in the top 10 cities for space absorption.”
The firm’s data shows that for the first 9 months of the year the top 10 cities for office absorption included Santa Clara, Brooklyn, Seattle, Raleigh/Durham and San Diego. These five tech-centered markets each have seen more than 1.0 million square feet (msf) in space absorption – with Santa Clara reaching nearly 3.4 msf.
Despite the strength of the top markets, 27 of the 87 markets analyzed by Cushman & Wakefield showed negative absorption; a combined total of 5.3 msf compared to 3.4 msf in the second quarter.
New construction meant that the nationwide vacancy rate crept up from 13.2% in the second quarter to 13.3% in the third quarter.
Asking rents for all markets including suburban and central business districts rose to a record high $30.57 per square foot, up 0.6 percent from the second quarter and 3.8 percent from a year ago.
Real estate firm Cushman & Wakefield says that the third quarter of 2017 saw strong fundamentals for the office market with stability nationwide for the past three months.
“More and more, the office market’s fortunes in 2017 are linked to the rise of the tech sector,” said Cushman & Wakefield’s Revathi Greenwood, Head of Research, Americas. “In 2016, Seattle was the only technology hub to rank in the top 10 cities for space absorption.”
The firm’s data shows that for the first 9 months of the year the top 10 cities for office absorption included Santa Clara, Brooklyn, Seattle, Raleigh/Durham and San Diego. These five tech-centered markets each have seen more than 1.0 million square feet (msf) in space absorption – with Santa Clara reaching nearly 3.4 msf.
Despite the strength of the top markets, 27 of the 87 markets analyzed by Cushman & Wakefield showed negative absorption; a combined total of 5.3 msf compared to 3.4 msf in the second quarter.
New construction meant that the nationwide vacancy rate crept up from 13.2% in the second quarter to 13.3% in the third quarter.
Asking rents for all markets including suburban and central business districts rose to a record high $30.57 per square foot, up 0.6 percent from the second quarter and 3.8 percent from a year ago.
