The gradual rollback of remote work arrangements, which were put in place as a short-term fix to keep businesses operating during the height of pandemic lockdowns, has now given rise to one of the most contentious issues in the employment arena. To return to the office, or not to return, that is the question. 

Some prominent businesses like Spotify are steadfastly upholding flexible work-from-home policies, stating resoundingly that “remote staff aren’t children.” Other tech giants, however, such as Amazon and iPhone challenger, Nothing, have made U-turns on their previous work-from-home policies, implementing return-to-office policies across the board for all corporate employees. 

Taking their lead from the tech heavyweights, return-to-office (RTO) mandates are now widespread for businesses throughout the United States. And with the new administration declaring an RTO mandate for all federal employees of government offices throughout the country, the tide well and truly seems to be shifting against remote, hybrid, and even flexible work schedules.

Drastic Shift: From Widespread Remote Work to Full RTOs

The prestige and dominant market power of big-name tech brands helps ensure they can continue to attract top talent in droves, regardless of any contentious mandates like a full RTO. This will remain true even despite the attrition of former remote hires who were attracted by the flexible work location policies of a few short years ago. 

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The United States is home to one of the world’s largest commercial real estate markets, accounting for nearly 40% of all real estate globally. The latest data from 2024 show that this market generates revenues in excess of $1 trillion, and 16 of the world’s 30 most competitive commercial property markets are located in the United States.

Early 2024 data show that the average asking price per square foot for US offices stands at $37. Retail averages out to $23 per square foot, and industrial space comes in at just under $8 per square foot. However, there are significant variations in average prices based on location and real estate class.

Here’s a summary of the average commercial property rates in key USA cities:

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Thanks to its academic status and thriving innovation scene, Boston is considered one of the top business hubs on the East Coast. In particular, the city and the surrounding areas have become the destination of choice for many startups, not only due to the availability of talent and funding, but also given the quality and diversity of office accommodation options. 

In this article, we offer detailed insights into the cost of renting office space in Boston, district by district. 

Office market trends in Boston

Over the past decade, the Boston office space market has seen fluctuating performance, witnessing shifts in demand and supply. Initially, the growth of the tech and life sciences sectors contributed to the expansion of the office market, with the development of new and modern spaces that could accommodate the requirements of these occupiers. Low vacancy levels translated into increasing asking rates, in particular in areas like East Cambridge and Sommerville, while other tenants were pushed out of the market as they couldn’t always compete with the budget of occupiers like MIT, Novartis, and Google. 

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Comparing Office Space Costs: LA vs. San Francisco

Los Angeles and San Francisco are home to some of the largest and most dynamic office space markets on the US West Coast. However, there are important differences in the costs involved in setting up an office in these locations. In this article, we offer a comparative cost analysis of office lease costs between Los Angeles and San Francisco.

Los Angeles: The US creative capital

Being the nation’s creative capital, Los Angeles is a magnet for businesses looking for office space to carry out media, entertainment, design, and advertising activities.

In 2023, the city’s creative industries contributed nearly 15% of the state’s total economic output.

The majority of these businesses are located in downtown LA but also in exclusive hillside and waterfront locations, such as Hollywood, Silicon Beach, the Arts District, Playa Vista, and Burbank.
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Recent years have seen some major U.S. educational institutions enter into partnerships with providers of flexible office space, creating coworking solutions that have already proven to be highly beneficial to both parties. These coworking spaces have served to support students by providing a professional environment where they are encouraged to interact with other college students and engage in networking opportunities. The coworking communities that have been formed on college campuses across the U.S. have also helped to support businesses surrounding these emergent hubs, providing them with direct links to students looking to enter the professional world.

Prior to 2020, the highly innovative coworking sector served to revitalize the somewhat stagnant office space market; experiencing healthy annual growth and gradually becoming accepted as a legitimate alternative to traditional offices. The shakeup caused by the COVID-19 pandemic, however, decimated the coworking space market, limiting growth and forcing coworking space providers to consider short-term alternatives.

Many of the partnerships made between coworking space providers and higher education institutions have already proven to be tremendously fruitful. The nature of these partnerships are also wide-reaching, with some campuses opening their facilities to serve as coworking spaces and others working directly with shared spaces to create ‘micro-campuses’ for remote students across the globe. Additionally, the partnered development of new coworking facilities within leading tech hubs has spurred greater innovation and investment than would have been previously possible for the hosting university to achieve alone. Ultimately, these higher education institutions have joined with global coworking leaders to uphold campus-like spirits of innovation, human interaction, and collaboration, whilst also introducing students to the professional atmosphere of a shared office space.

To say that this is a match made in heaven is an understatement. Read on to get some insight into how this innovative marriage was started, and how those leading the way are driving innovation, reshaping what constitutes an educational workspace, and influencing the connection between talented students and local businesses.

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Among the many changes brought about by COVID-19, the disruption to work arrangements and mobility patterns is perhaps the most profound. 

Since 2020, companies of all shapes and sizes have decided to re-structure their workforce, implementing new working models and providing employees with previously unforeseen levels of mobility. This freedom has resulted in many of these employees re-structuring their lives, relocating to more affordable or personally preferable cities. Moreover, the increased implementation of remote and hybrid office-work models has changed the way employers and employees think about location, causing many workers to reassess the need to live close to major business centers.

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The life sciences and healthcare sectors are two of the small handful of sectors that have come out stronger on the other side of the COVID-19 pandemic. This article offers an overview of relevant U.S. market data, as well as the way in which specialist office providers are serving the demands of businesses looking to house themselves in mixed-use office spaces that include both traditional desks and lab space.

Mixed-Use Office Space in the Life Sciences Sector

While offices occupied by countless other industries emptied virtually overnight in response to the pandemic, life sciences companies stayed put — with some even opting to move to larger premises to accommodate additional employees. In 2021, the sector was still attracting millions of dollars in investments — particularly in the fields of Biotech and Medtech — due to their status as safe, recession-proof assets. In fact, 2021 saw a record $78 billion of capital investments to life sciences-related companies in the United States, up from the $70 billion seen in 2020.

Rapid expansion also put pressure on these companies to source top talent. In the United States, life sciences is a leader for employment growth. Illustrating this — in Q1 2021 the life science sector had surpassed the tech sector in job creation numbers.  Read the rest of this entry »

Office Space

As of Q2 2022, we’re continuing to see signs of Atlanta’s increased post-pandemic recovery when compared to its peers. Office occupancy rates have shot up dramatically since Q2 2021, though leasing overall has still not reached pre-pandemic levels. Major players — including Google, Microsoft, Visa, and Airbnb — have been in the process of opening up thousands of high salary jobs in offices throughout Atlanta, heavily contributing to the increased positive sentiment that has permeated throughout the office sector in 2022.

Rents have settled after the turbulent events of the early 2020s. Vacancy rates in the metro are still sitting around 18%, making it harder for providers to hike rates. Overall vacancy rates have dropped from 18.8% in Q1 2022 to 18.4% in Q2, providing more evidence of recovery. Despite this, vacant square footage by volume has increased in the metro area, with just over 43 million sq/ft vacant in the middle of 2022 representing a rise compared to the same time in 2021, which saw 42 million sq/ft of vacant office space.

Vacancy rates in Midtown are down to 19% in Q2 2022, compared to 22% in Q2 2021. South Atlanta still shows the lowest vacancy rates across the metro area at 11.7%, though this is up from the Q2 2021 figure of 10%. Despite this increase, recovery is still trending positively when compared to other areas in Atlanta — though reaching the healthy metrics of 2019 is still a ways off. Read the rest of this entry »

The US office market struggle to get back on its feet for most of 2021, despite the year starting with the expectation that this arm of the commercial real estate market would be on its way to recovery by Q3 to Q4. Ultimately, the emergence of the Delta and Omicron variants of COVID-19 resulted in forecasts being revised, and the recovery horizon was pushed to 2022.

We’ve collected a brief overview of the trends, figures, and projections for the 2022 US office space market below, check back frequently in the year ahead for more insight into industry trends and recovery projections.

Economic Indicators Tipped to Improve

There are many factors influencing office market performance, but macro-economic indicators are some of the most critical. As we settle into 2022, a decline in unemployment is expected to be one of the most important factors underscoring the recovery of the office market. Recent data from the U.S. Bureau of Labor Statistics outlined a small uptick in unemployment in January 2022, moving from 3.9% at the end of 2021 to 4.0% to end the first month of the new year. Read the rest of this entry »

Notable Office Market Insights

•  Ongoing recovery is the main theme, continuing the trend seen in most office markets throughout 2021.
•  Positive absorption indicators.
•  Slight increase in rental rates.
•  Marked differences in occupancy levels, vacancy rates and general performance from city to city.
•  Remote working practices are still commonplace in key markets, such as San Francisco.
•  142 million square feet of office space currently under construction.

Lease Rates & Asking Rents

Recent data from Commercial Edge outlines a nationwide rental listing rate average of $38sq/ft in January 2022. These figures may be seen as somewhat inflated due to the number of high quality spaces currently listed due to being vacant, with Class A workspaces being listed at much higher prices.

According to Avison Young, Q4 average rental prices per square foot in gateway markets were as follows:

•  Manhattan: $84 sq/ft
•  San Francisco: $80 sq/ft
•  Washington DC: $54 sq/ft
•  Atlanta: $29 sq/ft
•  Boston: $38 sq/ft
•  Chicago CBD: $39 sq/ft

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