Ongoing strong demand from office-using employment sectors produced another increase in U.S. office-asking rates in August 2019, according to a new report from Yardi® Matrix.
The 0.1% year-over-year asking rate increase continues the year’s growth trend. National vacancy rates dropped 10 basis points from July to 13.4%, and office-using employment is rising faster than the overall labor market.
“Markets with lower-than-average vacancy rates and solid office-using employment growth continue to have the highest rate of year-over-year growth in listing rates,” the report says, citing San Francisco, Tampa, Florida, and Nashville, Tennessee, as the biggest gainers.
New office deliveries in the first eight months of 2019 totaled 40.1 million square feet, with another 179.1 million square feet remaining under construction. Year-to-date transaction volume totaled $55.2 billion and low borrowing rates “should continue to drive sales, as the cost of debt remains cheap,” according to the report.
More information about U.S. office property lease rate, occupancy trends, transactions and more is available in the national office report for September 2019.