Yardi Matrix Report Spotlights Slow but Steady U.S. Office Rent Growth

Bullish job market drives asking rents up; 10-year Treasury rate drop could spur sales

SANTA BARBARA, Calif.,
June 27, 2019 – U.S. office properties,
riding an ongoing strong job market, saw asking rents rise 0.4% in May 2019
over the previous three-month period, according to a new national report from Yardi® Matrix.

The report notes
that although 173 million square feet of office space is under construction,
the pipeline is mostly concentrated in metros that have growing space needs or
a strong demand for newer product with updated technology and amenities.
Brooklyn, N.Y., Nashville, Tenn., and Austin, Texas, have the most space under
construction as a percentage of existing stock, while Manhattan, N.Y., has 20.8
million square feet—more than twice as much as any other metro. The national
occupancy rate held steady at 13.7% in May.

Year-to-date sales
totaling $28.5 billion through May were “weak compared to recent years, but
activity could pick up as capital markets begin to settle down,” the report
says; meanwhile, “institutional capital continues to pour into the industry”
and the recent drop in the 10-year U.S. Treasury rate could boost sales.

View the full Yardi Matrix national
office report for June 2019.

Yardi Matrix
offers the industry’s most comprehensive market intelligence tool for investment professionals, equity investors, lenders
and property managers who underwrite and manage investments in commercial real
estate. Yardi Matrix covers multifamily, industrial, office and self storage
property types. Email
[email protected], call 480-663-1149 or visit yardimatrix.com to learn more.

About Yardi

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types and sizes of real estate companies. Established in 1984, Yardi is based
in Santa Barbara, Calif., and serves clients worldwide. For more information on
how Yardi is Energized for Tomorrow, visit yardi.com.