Building Successful Relationships

2019 U.S. Office Investment, Leasing Shatters Records

Demand for U.S. offices throughout national and Philadelphia commercial real estate markets set a post-recession record in 2019 as companies and real estate investors set aside concerns about a slowing global economy and snapped up workspace.

The average U.S. office vacancy rate matched a post-recession low of 9.7 percent and office sales and leasing set new records in 2019 in the U.S. commercial real estate market – including Philly retail space, CoStar economists say in the “2019 Year in Review of the U.S. Office Market” video (available by clicking here). This should result, they say, in strong demand and performance through at least the middle of this year as technology companies like retailer Amazon and iPhone maker Apple move into new offices.

This CoStar Realty Information Inc. report involving U.S. and Philadelphia commercial properties is being made available through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

Led by about 8 million square feet taken by shared-office provider WeWork, total signed leases among U.S. and Philadelphia commercial real estate listings increased to a record 360 million square feet in 2019, and the total could rise by another 100 million square feet as CoStar researchers wrap up data collection for the year, said John Affleck, CoStar’s vice president of market analytics. WeWork is expected to scale back in 2020 after it scrapped an initial public offering and replaced its CEO in 2019.

About 160 million square feet of office space is under construction, roughly 2 percent of the nation’s total office supply, with Austin, Texas; Nashville, Tennessee; and San Jose in California logging the most building activity. Expanding tech firms such as Salesforce and Pinterest have snapped up space for future growth, signing leases for national and Philadelphia commercial real estate properties even before buildings receive development approval, said Mike Roessle, director of U.S. office analytics for CoStar Group.

“It’s surprising that large tenants are finding available space in such a low-vacancy rate environment,” Roessle added.

While average rent growth decreased in 2019, it ended the year at an average 1.8 percent. CoStar expects those trends to continue in 2020, forecasting 1 percent average annual rent growth from this year through 2024, Roessle said.

Despite rising concern about the possibility of a global recession, investors shelled out more than $130 billion to buy buildings last year, a figure that could approach $150 billion as CoStar’s researchers finish collecting deal information. That would be the highest total since 2007, the peak of the previous real estate boom.

Office investment in New York City was down significantly while sales in Seattle, San Francisco and other tech-focused markets increased last year, Affleck said. – By Randy L. Drummer, CoStar Realty Information Inc.

For more information about Philly retail space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly retail space.

Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly retail space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly retail space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need – a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

Share

Share

Share