Office Benefits from Pickup in Jobs and GDP — Leasing and Rents Rise Again

As highlighted in Colliers’ Q3 2018 U.S. Office Market Outlook, the U.S. office market remains on solid ground. Absorption rebounded in Q3 2018 to the highest level in two years. CBD rents rose, and suburban rents held firm. Office vacancy is now at a cyclical low of 11.8% on average for the U.S.

A recent uptick in GDP combined with solid job growth should generate more demand for office space in the near term, but leasing is likely to slow with the expected economic slowdown next year as the economy absorbs higher interest rates and battles labor shortages created by extremely low unemployment rates. Growth is widespread geographically. Positive trends this quarter were led by several lower-cost, high-growth markets.

Key takeaways from this report include:

Be sure to explore the Q3 2018 update to Your Market Insights Hub | U.S. Office, which presents the latest data and forecasts in a detailed, interactive format – including a new metro map feature.