Our Research team’s fall Skyline Reviews are hot off the press. They are an exclusive analysis of the Downtown premium tower and low rise markets, and 56 top tier Cambridge office and lab buildings.
We define the Boston skyline as 44 Class A buildings that are taller than 15 stories and at least 250,000 square feet. in size, and/or are architecturally significant. The future for Boston’s CBD is bright due to positive job growth, tight office fundamentals, and continued urbanization. Office fundamentals in the three Downtown tower markets of the Back Bay, Financial District and Seaport remain tight compared to a year ago. The Boston CBD has a skyline vacancy of 9.7 percent. Rents are up 4.4 percent to $52.16 per square foot. We expect them to rise further in the near term as space options are limited.
The Financial District tower subset saw its availability rate increase by 3.2 percentage points. Vacancy has remained virtually unchanged compared year-over-year. The Back Bay skyline shows a low 4.4 percent vacancy, and an availability of 8.4 percent. The Seaport’s existing tower market is also tight with vacancy and availability rates of 10.0 and 14.6 percent respectively.
Our Cambridge Skyline Review is a deep dive into the city’s top tier assets of 28 office and 28 lab buildings across three Cambridge submarkets. The Cambridge skyline is also air tight in these property types. Continued demand, lack of existing availability, and arise in construction are putting upward pressure on asking rents. The office market here continues to attract a number of new entrants who have a home base on the West Coast. Among them are Twitter, Amazon and Facebook. Today’s Cambridge skyline lab asking rents are $53.58 psf triple net, up 3.8 percent since our Spring Skyline study.
Cranes are evident across the Cambridge landscape. There’s 1.7 million s.f. of lab construction underway with 92 percent of it pre-leased. For 100,000 s.f. plus users looking for Class A lab space, there are a number of shovel-ready options. Alexandria has two more build to suit opportunities in Kendall Square. Thee are additional opportunities at both NorthPoint and Discovery Park.