Posts Tagged ‘Office Talk’

US Office Market Trends 2022 – Statistics, Challenges and Outlook

February 24th, 2022

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 »

January 2022 – U.S. National Office Market Report

February 11th, 2022

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:

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Cost of an Office Fit-Out or Renovation in the USA

July 21st, 2021

Office renovations can help create a more productive workplace and support a business’s branding strategy. However, these projects can have a significant impact on capital expenditure. Calculated per rentable square foot (RSF), fit-out and renovation costs went ranged from $90 to $220/RSF in 2019-20, depending on location, office size, cost of labor, and industry sector – since some businesses (such as tech companies) require fit-outs to higher and more costly specifications.

What follows is a breakdown of the costs involved in renovating an office in the United States. *

Construction Costs

These costs involve the removal, addition or alteration of physical elements in a building, office floor or office unit. Construction costs include materials and labor, as well as fees charged by contractors, and they serve as the biggest expense in fit-out projects – accounting for 50% to 70% of the total cost.

Average costs are $90/RSF. Depending on location, they can be as high as $139/RSF or as low as $54/RSF.

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Office Features to Look Out for in the Second Half of 2021

June 23rd, 2021

The US office market has been dramatically transformed by the changes to work practices and mobility restrictions implemented throughout the course of 2020 and early 2021. Whilst it was predicted that the market would slowly rebound starting in recent months, the demands of office occupiers will have changed substantially since the start of the COVID-19 pandemic. Below is a brief overview of the main things to look for in an office space during the second half of 2021.

Office Layout

Flexible spaces

Flexibility remains a key consideration when choosing an office, not only in terms of lease terms, but also office layouts. Many office-based companies are still unsure about their ability to retain staff in the face of reduced revenue, combating this uncertainty by implementing rotating shifts or flexible work hours, two factors which have ultimately led to businesses struggling to identify the total headcount in the office at any given time.

This uncertainty will lead to an increase in demand for modular spaces that can be adjusted depending on the number of people present in the workplace. These kinds of dynamic layouts have been an option for several years, often going hand in hand with trends towards multi-functional office spaces. Some of the main elements that typify flexible workspaces include:

  •  Blurred indoor to outdoor transitions.
  •  Movable walls and room dividers.
  •  Lightweight or mobile office furniture.
  •  Adjustable or movable lighting.

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Quick Glossary of Commercial Real Estate Terms

March 22nd, 2021

There are certain terms you need to be familiar with when renting commercial property in the United States. Here is a list of the most important key words, in alphabetical order.

All-Inclusive

All-inclusive space is available at a fixed fee and typically gives tenants access to equipped workstations, admin/reception support, and meeting rooms. Utilities, janitorial services, and security are usually included.

Class A/B/C

Office space is classified into three classes depending on quality standards and the amenities on offer.

Class A

Class A space is considered best-in-class and is usually located in new buildings that feature the highest standards of construction, design, and amenities. These offices are typically found in prime business locations.

Class B

Class B space offers a functional standard of accommodation to office-based businesses in need of well-maintained space at a reasonable price.

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Atlanta’s Tech Square

February 6th, 2021

Tech Square is a rapidly developing neighborhood covering a total of approximately 8 acres. The area is located in Midtown Atlanta, between 3rd and 8th Streets in their intersection with Williams and West Peachtree. Approximately 3 miles north of downtown Atlanta, Tech Square can be accessed via bike lanes, mass transit, and two interstate roads.

The development of Tech Square is part of a revitalization project that has been transforming the face of Midtown since the early 2000s. Today, the area is known for its bustling character and high business density, especially in the creative and tech sectors.

The creation of this new district has put Atlanta’s office market in the spotlight. The city is now considered a robust secondary market with strong fundamentals and millions of square feet under construction. The largest sub-markets are the CBD, Midtown, and Buckhead. Approximately half of Atlanta’s total office inventory is Class A space, which is particularly abundant in Tech Square.

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United States Commercial Property Prices 2020: Per Square Foot

December 15th, 2020

The United States is home to one of the world’s largest commercial real estate markets, with an estimated worth of approximately $950bn. In terms of size, industrial space is the largest sub-market with 21bn square feet, followed by retail with 13bn, and offices, which account for 11bn.

In Q2 2020, the average price per square foot for US offices was just over $35. Retail averaged out to $18.09 / square foot, and industrial space came in at just under $8 / square foot. However, there are significant variations in average prices based on location and real estate class. Here is a summary of average commercial rates in key USA cities:

  •   New York: Average gross rates for metro New York offices are $81 / sq ft / year. Industrial space averages $19 / sq ft / year.
  •   Los Angeles: $44 / sq ft / year for offices in the metropolitan area and $11 / sq ft / year for industrial premises.
  •   Miami: In the same range as Los Angeles for CBD offices and slightly lower for industrial space ($8 / sq ft / year).
  •   Boston: $39/ sq ft / year for metro offices, rising to $80 in Cambridge. Industrial properties average $10 / sq ft / year.
  •   Philadelphia: $36 / sq ft / year for city center offices, $27 for suburban space, and $6 / sq ft / year for industrial properties.
  •   Atlanta: Slightly under $30 / sq ft / year for offices with a rate of $35 in Downtown Atlanta. Industrial space is charged at an average of $5 / sq ft / year.
  •   Chicago: Approximately $33 / sq ft / year for office space, rising to averages above $40 in The Loop. Industrial premises average $6 / sq ft / year.
  •   Dallas and other urban centers in Texas: between $25 and $30 / sq ft / year, whereas industrial rates are below $5.

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The Benefits of Los Angeles Satellite Office Space

August 28th, 2020

Low-angle Photo of Four High-rise Curtain Wall Buildings Under White Clouds and Blue Sky

The need for a satellite office is often a marker of business growth and success. Relocating the main headquarters and operations of a business isn’t always practical due to the time and expenses involved. As businesses evolve and expand their reach across the globe, they often require a physical presence in multiple locations, allowing them to operate effectively outside of their initial location. A multinational tech giant, such as Amazon, can be seen as a prime example of a business that utilizes satellite offices across the globe to ensure that their reach extends beyond their main Seattle office space. For many companies, acquiring satellite locations is the most feasible way of meeting growth and expansion needs, especially when there are contractual or financial limitations to how much an office can be physically expanded.

Satellite offices, also known as branch offices, tend to have a smaller footprint than their parent company. Many organizations benefit from having a network of satellite locations instead of a centralized office, creating a web of offices which allows them to operate to maximum efficiency.

Satellite offices can be in a different city, county or state from their parent company or the company’s headquarters. To determine where a satellite office should be based, factors such as the proximity to the target market, tax or financial incentives, and the area’s business or economic development climate are taken into account.

As part of the state of California, Los Angeles is renowned for its thriving business scene and strong economic indicators. The city benefits from a mature commercial real estate market that offers a great variety of alternative office spaces, usually ranking among the top five in the United States. Read the rest of this entry »

Smoking in the Workplace

October 13th, 2009

SmokingA report from the Substance Abuse and Mental Health Service Administration has revealed which occupations have higher levels of smokers. Of all the full time employees in the United States aged between 18 and 64, 28% had smoked cigarettes in the previous month. Food-service workers came in highest with 45% having smoked during that same period. The second highest groups are construction workers and miners, coming in at 42.9%.

The study also showed that people who work in training, education and library fields smoke the least, with only 12.3% having lit up in the previous month.

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The Green Office – Recycling

April 23rd, 2009
Office Recycling

Office Recycling

Every office should have a recycling scheme in place, our planet is our responsibility and the waste recycling habits you keep at home should be continued in the workplace. There are many types of waste products that can be recycled in the office, from paper to computers.

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