{"id":6714,"date":"2024-01-05T10:12:25","date_gmt":"2024-01-05T10:12:25","guid":{"rendered":"https:\/\/www.yardimatrix.com\/blog\/?p=6714"},"modified":"2024-01-17T11:32:30","modified_gmt":"2024-01-17T11:32:30","slug":"us-office-market-outlook-december-2023","status":"publish","type":"post","link":"https:\/\/www.yardimatrix.com\/blog\/us-office-market-outlook-december-2023\/","title":{"rendered":"U.S. Office Market Outlook \u2013 December 2023"},"content":{"rendered":"<p><em>Office investment year-to-date in November reached $30.1 billion, the latest Yardi Matrix report shows.<\/em><\/p>\n<h2>Report Highlights<\/h2>\n<ul>\n<li>The average full-service equivalent listing rate was $37.73 per square foot at the end of November, a 0.9 percent decrease when compared to November 2022.<\/li>\n<\/ul>\n<ul>\n<li>Office vacancy continued to go upward, reaching 18.2 percent in November across the top 50 U.S. office markets, up 190 basis year-over-year.<\/li>\n<li>The under-construction pipeline featured 99.6 million square feet of office space at the end of November.<\/li>\n<li>Nationwide office transaction volume totaled $30.1 billion year-to-date in November.<\/li>\n<li>Office assets changed hands at an average of $193 per square <strong>foot.<\/strong><\/li>\n<\/ul>\n<h2>Remote work impacts office vacancy, rental trends<\/h2>\n<p>The national office vacancy rate continued its upward trend, reaching 18.2 percent by the end of November\u2014a 190-basis-point increase from the same period last year. According to Yardi Matrix, markets with a substantial remote workforce such as San Francisco (510 basis points), Seattle (430 basis points), the Bay Area (410 basis points) and Twin Cities (340 basis points) experienced the highest vacancy rate increases year-over-year.<\/p>\n<p><iframe id=\"datawrapper-chart-UtuDk\" style=\"width: 0; min-width: 100% !important; border: none;\" title=\"Top 10 Markets for Construction Activity\" src=\"https:\/\/datawrapper.dwcdn.net\/UtuDk\/3\/\" height=\"533\" frameborder=\"0\" scrolling=\"no\" aria-label=\"Table\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data[\"datawrapper-height\"][t]+\"px\";e[r].style.height=i}}}))}();\n<\/script><\/p>\n<p>In November, national full-service equivalent listing rates averaged $37.73 per square foot, marking a 90-basis-point decline year-over-year and a <a href=\"https:\/\/www.yardimatrix.com\/blog\/us-office-market-outlook-november-2023\/\"><strong>4-cent decrease from the previous month<\/strong><\/a>. Noteworthy average in-place rents were observed in gateway markets such as Manhattan ($70.78 per square foot), San Francisco ($62.18 per square foot), Boston ($45.31 per square foot) and Los Angeles ($41.60 per square foot). Other markets, featuring amenitized or new inventory, included the Bay Area ($54.41 per square foot), Miami ($46.52 per square foot), San Diego ($42.20 per square foot) and Austin ($41.36 per square foot).<\/p>\n<h2>Slowing momentum in office space demand<\/h2>\n<p>Construction initiations experience a significant drop in 2023, with the under-construction pipeline revealing 99.6 million square feet at November's end. This constitutes 1.5 percent of the total stock, marking a more than 40 percent decrease compared to 2021 and 2022. While life science and Sun Belt markets exhibit more activity, overall development is easing across segments. Dallas leads in office construction starts, boasting over 3 million square feet. As of November, Boston, San Diego, Austin and Nashville have 13.5 million, 5.1 million, 5.0 million, and 3.1 million square feet of office space underway, respectively.<\/p>\n<p>Year-to-date office investment in November reached $30.1 billion, with an average sale price of $193 per square foot. Although average sale prices have declined in most markets, San Diego has remained stable, displaying a slight increase from $410 to $412 per square foot in 2023.<\/p>\n<p>Read the full <strong><a href=\"https:\/\/www.yardimatrix.com\/publications\/download\/file\/4914-MatrixOfficeNationalReport-December2023\">Matrix Office National Report-December 2023<\/a><\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Office investment year-to-date in November reached $30.1 billion, the latest Yardi Matrix report shows. Report Highlights The average full-service equivalent listing rate was $37.73 per square foot at the end of November, a 0.9 percent decrease when compared to November 2022. Office vacancy continued to go upward, reaching 18.2 percent in November across the top [&hellip;]<\/p>\n","protected":false},"author":753,"featured_media":6715,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[20,4],"tags":[427],"class_list":["post-6714","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-office-market","category-real-estate-trends","tag-office-market-outlook"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>U.S. Office Market Outlook \u2013 December 2023 - Yardi Matrix Blog<\/title>\n<meta name=\"description\" content=\"Office investment year-to-date in November reached $30.1 billion, according to the latest Yardi Matrix national report.\" \/>\n<meta name=\"robots\" content=\"index, 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