From Julia Georgules
New England Research Director
Boston MSA’s labor market remains one of the highest performing and stable across major U.S. markets. With an unemployment rate of 3.1 percent, among the lowest in the country, the strong labor force remains a major attraction for large tenants.
Large blocks continue to disappear with major tenants like Wayfair, WeWork, and other tech companies signing leases to expand. In addition to large leases, the capital markets were also active, with 1.5 million square feet trading hands across the market, for a total volume of approximately $650 million. Even though a lack of new, vacant supply has kept rent growth relatively flat during the quarter, demand during the remainder of 2018 should create more landlord-favorable leasing fundamentals in the form of rent growth.
Through the remainder of the year, supply constraints will remain a challenge to tenants looking to expand or relocate, but should prove beneficial to landlords with any existing space, especially those reinvesting capital in spec suites for today’s fast-moving tenants.