Posts Tagged ‘Seattle’

United States Commercial Property Supply and Vacancy Rates 2021 (Part 2)

February 25th, 2021

In a previous blog post we examined the performance of the commercial real estate market in some major US cities. This is the second article in this series, which uses data from late 2020 and early 2021 to examine vacancy and supply rates in cities such as Los Angeles, Chicago, Atlanta and Houston. These statistics illustrate the impact of COVID-19 on the commercial property rental market, as well as the types of properties that are holding strong in the face of negative trends.

Los Angeles

Los Angeles is a hub for creative, media, and entertainment companies, many of which are office-based. The city’s proximity to major cargo ports makes it convenient for logistics and distribution businesses, both of which have kept the industrial real estate market strong.

Offices

  •  Vacancy rates in downtown Los Angeles are 21.5%.
  •  In Q4 20202, there was more than 5.5 million square feet for vacant space, with 3.4 million feet being in the Financial District.
  •  The majority of vacant inventory involves Class A offices.
  •  Supply increased by more than 2 million square feet in the past 12 months.
  •  No new supply is expected to enter the market as no projects are currently under construction in the CBD area.
  •  Vacancy rates average 22.5% outside of the CBD, however, they reach 56% in the Fashion District.
  •  Vacancy rates are just under 18% in the Greater Los Angeles area.

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United States Office Space Rental Rates 2020

December 22nd, 2020

The United States office market is characterized by its wide range of properties, ranging from affordable shared spaces to expensive trophy offices in some of the world’s most desirable business locations. In mid-2020, average gross rates for offices nationwide stood at $35 per square foot with the priciest offices located in New York and California. Within these states, the sub-markets commanding the highest rates are:

  •   New York: Midtown Manhattan at $87 per square foot, specifically in Chelsea, the Plaza District, and Gramercy Park.
  •   California: The Shoreline/Mountain View area, in which prices reach $130 per square foot, followed by Santa Monica and the SoMa district of San Francisco.

Average asking rates in other prime office markets are as follows:

  •   Seattle: $70 per square foot, higher in Lake Union and the CBD.
  •   Washington DC: $55 per square foot.
  •   Cambridge and Boston: $40 and $80 per square foot, respectively.
  •   Los Angeles: Averaging $45 per square foot.
  •   Chicago: Exceeding $40 per square foot in the West Loop.
  •   Raleigh-Durham: $35 per square foot for CBD properties.

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