Transwestern released its 2017 year-end report on the national office market, which revealed that December’s 11.5% vacancy rate was the lowest reported in 10 years.
Significant net absorption in markets such as Dallas/Fort Worth; San Jose/Silicon Valley; Seattle; Northern Virginia; and Austin, Texas, contributed to this decline in vacancy, as did a deceleration in new construction starts during the fourth quarter.
Ryan Tharp, Director of Research for Transwestern’s Dallas office, noted that while Dallas led absorption in 2017 with nearly 5.3 million sf, the majority of major markets contributed to this consistent downward trend.
“Miami, for example, posted a 10-year low in overall vacancy during 2017 with an average 150,000 square feet of positive absorption each quarter,” said Tharp. “The strength of the office market is not confined to a few specific metros or regions.”
Healthy rent growth also was experienced around the country in the fourth quarter of 2017, with the top 10 markets in this category—representing Eastern, Central, and Western regions of the country—posting increases between 5% and 9%.
Boston, the outlier, led the nation in rent growth for the quarter, at 15.1%. Overall, the average asking office rental rate for U.S. office product ended the year at $25.51 per sf, reflecting 3.4% annual growth.
Confidence in the market’s performance through 2018 remains high, especially in light of recent tax cuts, which the business community is responding to favorably.
“Despite Northern Virginia having the second-highest office vacancy in the country at 16.8%, we believe consumer and business spending will strengthen in 2018, further bolstering both the local and national office market as companies grow to keep up with demand for good and services,” added Elizabeth Norton, Managing Director of Research based in Washington, D.C.
Download the national office market report at: http://twurls.com/4q17-us-office
Related Stories
High-rise Construction | Jun 29, 2016
Best Tall Buildings around the world favor unusual shapes and hybrid functions
The Council on Tall Buildings and Urban Habitat selects winners in four regions.
Office Buildings | Jun 16, 2016
Ability to focus, not perks, is top concern for office employees
Open-plan offices found to worsen distraction problem.
High-rise Construction | Jun 15, 2016
WilkinsonEyre designs diamond-patterned Bay Park Centre for Toronto
A sloping plaza with trees, grass, and gardens connects the two downtown towers.
Office Buildings | Jun 14, 2016
Let's not forget introverts when it comes to workplace design
Recent design trends favor extroverts who enjoy collaboration. HDR's Lynn Mignola says that designers need to accommodate introverts, people who recharge with solitude, as well.
Movers+Shapers | Jun 13, 2016
THE DISRUPTORS: The Millennial generation is imposing its will on design
AEC firms, particularly those that design hotels and offices, gain a competitive edge by knowing how to appeal to the largest share of the American workforce.
Office Buildings | Jun 10, 2016
Buildings that invest in wellbeing see healthy returns
Healthy workers are more productive workers, but fitness can be tough when employees at the office for 50 hours a week. Perkins+Will's Janine Grossmann offers the wellness components that landlords and companies should prioritize.
Office Buildings | Jun 10, 2016
Form4 designs curved roofs for project at Stanford Research Park
Fabricated of painted recycled aluminum, the wavy roofs at the Innovation Curve campus will symbolize the R&D process and make four buildings more sustainable.
Office Buildings | Jun 7, 2016
Incorporating places to rejuvenate into office design
Workspaces are geared toward socializing and collaboration, but people need quiet, calm places where they can sit alone and focus. Gensler's Penny Lewis offers three ways to design rejuvenation places into office settings.
Market Data | Jun 3, 2016
JLL report: Retail renovation drives construction growth in 2016
Retail construction projects were up nearly 25% year-over-year, and the industrial and office construction sectors fared well, too. Economic uncertainty looms over everything, however.
Building Team Awards | Jun 1, 2016
Multifamily tower and office building revitalize Philadelphia cathedral
The Philadelphia Episcopal Cathedral capitalizes on hot property to help fund much needed upgrades and programs.
