Boston office market reports
Q2 2021: Reopening efforts, higher vaccination rates, and strength of lab show a promising future for the Boston office market.
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With Boston-based companies beginning their workplace reopening efforts, higher vaccination rates across the regional population, and additional supporting market dynamics; the future looks bright for the Boston office market. Anchored by a 10.2% drop in regional unemployment (15.6% in April 2020 to 5.4% in April 2021), Boston is well on the way to an above-national-average recovery.
Reopening efforts and higher vaccination rates have allowed the Boston unemployment rate to rebound from a high of 15.6 percent in April 2020 to 5.4 percent in April 2021.
The office rate of recovery in Boston is at the front of the pack compared with other U.S. gateway cities on the heels of lab occupants. Biotech/ pharma companies have been returning to the office at rates that are more than double the national average of 19.2%, measuring in at 46.4 percent.
The sublease market continues to drag aggregate fundamentals, accounting for 2.2 msf of vacant space in Downtown Boston. However, notable tenants are withdrawing large sublease blocks from the market, which can be attributable to an anticipated return to the office and/or tepid sublessor demand in this market segment.
Asset pricing has softened for both office and lab alike. Though, when comparing office to lab, there is a 116 percent pricing differential between the two asset types, that is continuing to grow.
Demand for lab space has not waned, commanding a staggering $93 psf net effective rent.
Office vs. lab
The pricing differential for office versus lab net effective rents is 82.5 percent–and the pandemic has widened this gap.
Your source for the latest Boston office market reports
Get in-depth office market reports and insights from commercial real estate experts in the Greater Boston area. Avison Young advisors look at Boston commercial real estate activities and the latest Boston statistics to provide you expert market research on Boston's office properties.
Explore different topics like the latest office market pricing trends and analysis of Boston's current office real estate market conditions. Gain a better understanding of Boston’s office real estate outlook and stay ahead of current office space trends. Make smart decisions when it comes to investing in office properties in Boston's competitive office real estate market. Avison Young is your trusted source for commercial real estate office market insights in Boston.
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