Over the past seven months, sublease space has increased more than 41 percent, to 72 million square feet in the top 30 markets
SANTA BARBARA, Calif., Nov. 24, 2020 – Listing rates appear to be sticky relative to demand as owners and managers wait out the pandemic instead of lowering rates. Although there are reasons to believe that the traditional model of full time in-office work will not return, it is also reasonable to think that companies will want to retain office space for collaborative workplace activities that have diminished during the pandemic. These conclusions and much more are gained in the latest National Office Report from CommercialEdge powered by Yardi®, which is now available.
The latest data shows that the national average full-service equivalent listing rate fell 25 cents in month-over-month, to $38.11 while the national vacancy rate decreased 20 basis points from October to 13.4%. That jump has contributed to the glut of sublease space now available. Whether any takers for empty offices are out there, though, remains to be seen.
“Employment in sectors classified as office-using could also provide a ray of optimism in a sea of uncertainty,” states the report. “Office-using sectors, down 4.1% year-over-year, have continued to fare better than the labor market as a whole, down 6.1% year-over-year.” In nearly every market, office-using job sectors are performing better than the labor market as a whole.
Properties that were under construction when COVID-19 forced initial lockdowns are delivering, but little stock is being added to replenish the pipeline. Nationally, 54.6 million square feet have been completed in 2020, but the total under construction has decreased 12.4% since the start of the year.
Gain all the insight in the October National Office Report from the research experts at CommercialEdge. CommercialEdge provides extensive property data that includes transaction, ownership and debt information, offering nationwide coverage across all commercial real estate asset types. Use the platform to uncover vital market data and get insights with the latest lease and sale listings.
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