Office Sector Update

From Yardi Matrix

By Joel Nelson on Sep 5, 2019 in News

The U.S. office property market stayed on the upswing in July, with asking rates increasing 1.1% year-over-year. Office-using jobs increased 1.7% in the same period, driven by the computer design services portion of the professional business services segment, according to a new national report from Yardi^® Matrix. 

Additional good news includes a robust late-cycle construction pipeline comprising 174 million square feet of space. That will represent a 2.8% increase in inventory when delivered. Manhattan, N.Y., with 24.2 million square feet, and Boston and San Francisco, with 11.5 million square feet and 10.9 million square feet, respectively, are the leaders in that category.

Office space deliveries in the first seven months of 2019 totaled 33.8 million square feet, broken down by central business district (6.5 million square feet), urban (14 million square feet) and suburban areas (13.3 million square feet). Office sales valued at $46.5 billion took place through July, only slightly off last year’s pace.

Roiling capital markets haven’t affected demand for office space so far. “Economic growth has been running at an annualized rate of about 2.5%, and fundamentals such as employment and consumer spending remain healthy, so a recession does not appear to be on the immediate horizon,” the report says.

Find out what else is happening in the dynamic U.S. office market in the most recent Yardi Matrix national office report.