Employment trends and workplace safety concerns prompt ongoing changes for office market
SANTA BARBARA, Calif., July 28, 2020 – Commercial office listing rates haven’t yet been affected by the economic downturn, according to newly released Yardi Matrix® June commercial office data. Average full-service equivalent listing rates rose 14 cents from May to $38.39, but are down 10 basis points year-over-year. However, shifting office employment levels and workplace safety concerns are sure to impact the market for the rest of 2020 and possibly beyond.
Office-using employment increased by 347,000 jobs in June, but total employment in office-using sectors is still down by 2.4 million from the peak in February.
“With cases of the coronavirus spiking in many states, it is uncertain whether the job gains will continue through the summer. Many businesses are undergoing hiring freezes, so gains in the near term will be more reliant on the ending of furloughs than on rehires,” states the report.
Deliveries are looking much as they did at this point last year, according to the latest Yardi Matrix office report. The first half of the year saw 26.1 million square feet of office space completed, with a nearly equal split between suburban offices and urban locations. Pandemic notwithstanding, the year could still near 2019’s 76 million square feet of newly delivered office space.
The first half of the year saw $28.4 billion in sales, $22 billion of which occurred in the first quarter. Despite the drop-off in total volume, office properties have sold at an average of $290 per square foot this year, an increase of $17 over 2019.
Download the latest full Yardi Matrix office report for more market details.
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