Hughes Marino’s Post

"A recent analysis by commercial real estate data company CompStak found effective rents for New York's "prime" Class A #office space — considered to be new construction, trophy space or a property that was recently renovated — are up from 2019 on the whole but dipped in the past two quarters. Effective rents for that so-called prime Class A office space are up 18.8% from the 2019 quarterly average, compared to 2023 levels." 📊 🗞️ Read more in American City Business Journals' recent article: https://hubs.ly/Q02nh6MS0 #flighttoquality #commercialrealestate #realestatedata #data #realestate #rents #nycoffice

Very good insight on the current market trends I'm seeing. While economic headwinds persist, an uptick in lease activity, particularly for spaces smaller than 5,000 square feet, has Boulder commercial real estate professionals feeling fairly optimistic heading into the end of the year. For Boulder County, which has about 10 million square feet of office space, the third quarter vacancy rate was 22.2% in the most-recent quarter. https://lnkd.in/gJ4wNubk

On Tuesday, Taylor Driscoll and Bisnow featured Synergy in an article on Boston's office market trends!   The piece explores how companies are increasingly opting for affordable spaces in older buildings. Our acquisition of 101 Arch St. is a prime example of this shift, positioning Synergy to offer competitive rents and attract diverse tenants.   The article highlights several significant office leases and sales in the Boston area, illustrating a broader trend of tenants seeking value in Class-B and C properties. We're proud to be part of this dynamic market and excited about the opportunities it presents.   Read the full article here: https://lnkd.in/gWQhS64c   #BostonOffice #CommercialRealEstate #PropertyManagement #Synergy

Manhattan landlord SL Green has been one of the top-performing property stocks this year despite stiff competition for tenants. This performance suggests that the worst may be over for New York's office market, but challenges remain. SL Green Realty Corp, Manhattan’s largest office landlord, reported impressive second-quarter results, exceeding analysts' expectations with funds from operations reaching $2.05 per share. The company’s portfolio is performing well, with notable success at its Summit observation deck at One Vanderbilt. SL Green aims to lease 2 million square feet of space in 2024, having already secured tenants for 1.4 million square feet. They also anticipate an occupancy rate of approximately 91.5% this year, signaling a recovery trend. Shareholders are optimistic, as SL Green’s stock has outperformed in the property sector and trades at a premium to its asset value. However, the broader Manhattan office market still faces significant hurdles. Since March 2020, an additional 42.8 million square feet of office space has flooded the market, pushing the office availability rate to 17.9% by the end of June, a slight decrease from the all-time high of 18.1% recorded in the first quarter. Tenants prefer high-quality, Class A buildings to encourage workers back to the office, resulting in these buildings capturing the majority of leasing activity. However, with almost two-thirds of Manhattan’s office stock being Class A, the market remains oversupplied, necessitating landlords to offer incentives such as free rent and generous tenant improvement allowances. Certain areas are showing resilience, such as Class A buildings built since 2000 with a lower-than-average 13% availability rate. Midtown, particularly the Plaza District, is seeing a decrease in empty spaces, and rents in Hudson Yards, Greenwich Village, and Chelsea are surpassing their prepandemic averages. In contrast, Downtown is struggling with higher vacancy rates and declining rents. Conversion of older office buildings to residential properties, like the Flatiron Building, is a strategy to reduce excess office space. However, significant demand growth is needed to substantially lower the overall availability rate. Despite recent gains, SL Green’s share price is still about 30% below its prepandemic levels. While there are positive signs, Manhattan’s office market remains a challenging environment. #NewYorkRealEstate #ManhattanOffices #SLGreen #OfficeMarketRecovery #RealEstateTrends #CommercialRealEstate #NYCRealEstate #OfficeSpace #PropertyInvestment #ClassABuildings #RealEstateNews https://lnkd.in/eSPncB9x

"No recent real estate deals capture the current dynamics of San Francisco’s changing office market quite like this deal..." The deal includes: 1. 49% reduction in current rent for certain city departments ($40/sqft in yr 1) 2. $100/sqft in TI 3. Option to buy the building at a price "not less than $200/sqft" At prices like these, will be interesting to see which offices get re-tenanted and which get converted into an alternate use - #multifamily, anyone? #SF #officeconversion #WFH https://lnkd.in/gErB6wbb

Denver's office market experienced positive net absorption in Q2, only the second time since the pandemic. Led by suburban leasing, 261K SF was absorbed, indicating a rebound in demand. While overall vacancies remain high at 23.9%, downtown Class-A properties continue to drive tenant demand and show promise with 23.2% vacancy. Average rents rose by 5.3% to $33.82/SF, as the preference for high-quality office spaces continues to trend. Read more from Bisnow. #denverofficemarket #commercialrealestate #officespace #businessnews #TributaryRealEstate

Looking for a prime office space? Consider a suburban location! According to Graeme Webster, these properties are in high demand as companies seek to offer their employees a better commute and access to amenities. “Traffic is getting tougher, parking is getting difficult to find (downtown). There’s a pain-in-the-butt factor that didn’t used to exist that people don’t want to deal with. It’s closer to home, closer to amenities. Because of that, activity has been (strong).” Graeme recently facilitated the sale of 2 Gurdwara Dr. He noted that "suburban properties in prime locations with robust fundamentals" are attracting interest from local investors. Ottawa Business Journal: https://lnkd.in/evgcXnj4 #Ottawa #CRE #AYdifference

DC’s Office Real Estate Market May Not Be Doomed After All 💼💰 Despite predictions of doom, DC's office real estate market may not be as bad as we thought! 🤔 A recent study shows that demand for office space is on the rise, with companies looking to invest in the city's vibrant and growing economy. 🏙️ So, if you're a business looking to make your mark in the nation's capital, now may be the perfect time to secure your spot in the bustling DC market. 📈 Let's stay positive and keep pushing forward! 💪🏼 #DCOfficeMarket #RealEstateGrowth #BusinessOpportunities #WashingtonDC #EconomyBoost #OfficeSpace #Investment #PositiveOutlook #TrendingNowvia @washingtonian

BAY AREA REAL ESTATE New data suggests it could take nearly 20 years for S.F.’s struggling office market to recover By Laura Waxmann, Reporter June 11, 2024 Perennially optimistic and boosterish, San Francisco’s commercial real estate brokers make a living selling the city’s landmarks and views, its restaurants and innovation. For them, the view is always bright and clear from the top of buildings like Salesforce Tower. But, these days, some of the city’s leading brokerages see a future that is so murky and difficult to decipher they are not confident saying what will happen next year — let alone a decade from now. Those who dare wager in long-term projections do not speak in absolutes, but in “best” and “worst” case scenarios. This is what they’re saying about San Francisco: It could take 18 years, or until 2042 for the city’s office market to recover to its pre-pandemic splendor, according to new data compiled by real estate firm Avison Young that’s based on past recovery trends. For some perspective: Eighteen years ago Steve Jobs was still a year away from announcing the first iPhone, and tech titans Airbnb and Uber were still a few years away from launching. Eighteen years is the “worst case scenario,” said Mark McGranahan, a veteran office broker with Avison Young. The outlook is based on the average annual amount of space that was gobbled up by office tenants over the decade preceding COVID-19 — or roughly 1.3 million square feet per year — and assumes that the city’s office market will truly be in recovery mode once vacancy falls below 10%. At the start of this year, San Francisco recorded the highest office vacancy out of any U.S. market at over 30%. “Ten percent is sort of the magic number — vacancy falls below 10% and landlords become emboldened. Rents start to rise. The market tightens up and people start thinking about new development,” McGranahan said. “If that’s the target, at least historically, then it’s a numbers problem: Let’s say the office market is 100 million square feet, you have 30 million square feet of vacant space and need to get down to 10 million square feet before the market starts shifting. How long does it take to absorb 20 million square feet?” https://lnkd.in/gk9rqBhn

Q2 2024 #RenoNV Office Market Update: Enduring Stability Despite Occupancy Losses. As we reflect on the first half of 2024, Reno's #office market has shown remarkable resilience amidst significant challenges. Here's a snapshot of the key highlights: The State of Nevada has been a major player this year, signing a 79,200 sq. ft. lease in Q1, followed by a 29,000 sq. ft. lease in Q2. This activity signals strong state-level commitment to office space, driven by return-to-office policies. Despite these positive developments, Q2 saw a substantial net #absorption of -75,571 sq. ft., pushing the #vacancy rate to 10.9%, the highest since Q2 2022. However, it's worth noting that year-to-date net absorption remains positive. Year-to-date #leasing activity reached 335,402 sq. ft., a 33.8% increase compared to the first half of 2023. The State of Nevada alone accounted for 108,104 sq. ft. of this total. Regional asking #rents declined by 2.8% to $1.88 per sq. ft., with notable decreases in Downtown Class B properties. #Sales volume was modest at $12.6 million, reflecting limited investor interest due to higher interest rates and constrained capital sources. Despite the occupancy losses, the lack of new supply and ongoing leasing activity are expected to stabilize the market. The upcoming occupancy of previously signed leases, such as the Nevada Department of Health & Human Services' move into 28,856 sq. ft. at 9850 Double R Blvd, should provide additional stability. Reno's office market continues to demonstrate its resilience. As we navigate the second half of the year, we anticipate positive trends, supported by strategic leasing activities and a stable local #economy. Please see our Q2 2024 Reno Office Market Report for additional data and commentary and contact me with any inquiries. https://lnkd.in/ddx6cecP #RenoRealEstate #OfficeMarket #CommercialRealEstate #CRE #MarketUpdate #LeasingActivity #RealEstateResearch