Pittsburgh office market report
Q3 2023
The Pittsburgh office market has faced challenging conditions in 2023, marked by leasing volume continuing to struggle in its rebound to pre-pandemic norms. While the secondary market remains near all-time highs, the increase in additional sublease space has decelerated over the past year. Average asking rental rates have managed to grow over the same period, but tenant concession packages have also grown, leaving net effective rates to remain level or in some cases decrease.
Annual market leasing activity through Q3
Total annual leasing volume in Pittsburgh has grown for three consecutive years, but 2023 has seen the lowest three-quarter leasing volume since the onset of the pandemic. This total of 1.5M sf is down 58% from the average three-quarter leasing total between 2013-2019.
Total available sublet space in Trophy/A product
The secondary market size remains near all-time highs after an explosive growth in 2020. Although, the increase in additional sublease space has decelerated over the past year. This is a result of both leasing activity in the secondary market and increased vacant spaces.
Growth in average asking rental rates since Q1 2020
There is more supply currently on the market than nearly ever before. Since the beginning of 2020, only four quarters have experienced positive net absorption while asking rental rates have grown 4.9% over that same period. At the same time, however, tenant concession packages have also grown, leaving net effective rates to remain level or in some cases decrease.
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