Another Day at the Office: Asking Rates Rise Again, Yardi Matrix Reports

Strong fundamentals push key U.S. office market metrics up in August

SANTA BARBARA, Calif., Sept. 26, 2019 – Ongoing strong demand from office-using employment sectors produced another increase in U.S. office asking rates in August 2019, according to a new report from Yardi® Matrix.

The 0.1% year-over-year asking rate increase continues the year’s growth trend. National vacancy rates dropped 10 basis points from July to 13.4%, and office-using employment is rising faster than the overall labor market.

“Markets with lower-than-average vacancy rates and solid office-using employment growth continue to have the highest rate of year-over-year growth in listing rates,” the report says, citing San Francisco, Tampa, Fla., and Nashville, Tenn., as the biggest gainers.

New office deliveries in the first eight months of 2019 totaled 40.1 million square feet, with another 179.1 million square feet remaining under construction. Year-to-date transaction volume totaled $55.2 billion and low borrowing rates “should continue to drive sales, as the cost of debt remains cheap,” according to the report.

More information about U.S. office property lease rate, occupancy trends, transactions and more is available in the national office report for September 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 matrix@yardi.com, call 480-663-1149 or visit yardimatrix.com to learn more.

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Yardi® develops and supports industry-leading investment and property management software for all 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.