With work-from-home firmly established, many real estate analysts predict a dramatic reduction in office space leasing and plummeting property values.
But the high-end of the office segment might actually be headed for a shortage, according to real estate intelligence company CoStar Group. This counterintuitive trend is due to a drastic drop in construction of elite Class A properties.
Despite the overall drop in occupied office space, buildings aged 0-3 years are doing well. They have attracted an average of 12.7 million sf per quarter since the beginning of 2020. By comparison, the quarterly average from 2011-2019 for similar properties was 11.7 million sf.
Office construction has slowed dramatically this year. Less than 30 million sf has broken ground in 2023, making it the lowest year for construction starts since 2011. If this trend continues, the type of space most in demand—newly constructed units—will have the shortest supply.
Related Stories
Market Data | Mar 6, 2016
Real estate execs measure success by how well they manage ‘talent,’ costs, and growth
A new CBRE survey finds more companies leaning toward “smarter” workspaces.
Office Buildings | Mar 2, 2016
HDR redesigns Twin Cities' studio to have coffee shop vibe
With open spaces, huddle rooms, and a design lab, the firm's new digs are drastically different than the old studio, which felt like working in a law office. Design Principal Mike Rodriguez highlights HDR's renovation plan.
Office Buildings | Mar 1, 2016
SmithGroupJJR and The Christman Company create a financial headquarters without the drab
The “un-bank” design ditched the stuffy design elements typical of financial institutions and, instead, created something much more inviting.
Office Buildings | Feb 29, 2016
Mobileapolis: An open experiment in workplace mobility
Check out this fun infographic that explains Perkins+Will's ambitions, findings, and next steps for the future home of the firm's Minneapolis office.
Office Buildings | Feb 26, 2016
Benching, desking, and (mostly) paper-free: Report identifies top trends in workplace design for 2016
The report, from Ted Moudis Associates, encompasses over 2.5 million sf of workspace built over the past two years.
Game Changers | Feb 5, 2016
Asia’s modular miracle
A prefab construction company in China built a 57-story tower in 19 days. Here’s how they did it.
Game Changers | Feb 4, 2016
GAME CHANGERS: 6 projects that rewrite the rules of commercial design and construction
BD+C’s inaugural Game Changers report highlights today’s pacesetting projects, from a prefab high-rise in China to a breakthrough research lab in the Midwest.
Mixed-Use | Jan 25, 2016
SOM unveils renderings of dual-tower Manhattan West development
The five million-sf project includes two office towers, a residential tower, retail space, and a new public square.
Office Buildings | Jan 21, 2016
Nike reveals design, first images of planned 3.2 million-sf expansion to its world headquarters
The expansion looks to combine design elements inspired by human movement, speed, and the strength and energy of competition.
| Jan 14, 2016
How to succeed with EIFS: exterior insulation and finish systems
This AIA CES Discovery course discusses the six elements of an EIFS wall assembly; common EIFS failures and how to prevent them; and EIFS and sustainability.