As you may have read in our local Q4 Office Insights report, 2015 ended on a high note for the Greater Boston region. And it was a similar story of success on the larger US scale. As our new Q4 2015 US Office Outlook reveals, here are the 5 biggest trends and their implications on the year ahead:
#1: Despite global economic uncertainty, the United States economy continued to expand in 2015 through both employment and output, with innovative economies leading in growth, but a diversity of markets gaining momentum.
#2: For office tenants across the country, 2015 was a year of growth as nearly 50.0 percent of leasing activity represented company expansion — a trend that should persist through 2016.
#3: CBDs remain the premier location for many tenants, but with a 63.6 percent rent premium suburbs are starting to pick up as pricing and competition encourages many tenants to look to markets like Atlanta, Charlotte, Dallas and Raleigh-Durham in increasing numbers.
#4: Total vacancy declined to its lowest level in eight years even with the addition of more than 44.2 million square feet of new supply across the country. With roughly 50.0 percent of 2015 leasing representing company growth, further occupancy gains will mount throughout the year.
#5: 2016 is expected to be another year of big numbers as markets prepare to deliver 48.9 million square feet of new supply, putting upward pressure on rental rates while providing large tenants with much needed supply to support expansion.
Download our complete Q4 2015 US Office Outlook for more national perspectives and to see how Boston is faring within the context of the rest of the nation. If you have any questions or need any information, feel free to contact me.