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Nearly 35% of PA suburban tenants seeking space are looking to grow their footprint, creating a bright outlook for absorption over the next 18 months

• A look back at three years of active tenant requirements and their intention to grow, shrink, or remain the same size reveals that, since 2015, the percentage of suburban tenants that are growing has increased considerably. In 2015, only one fifth of active requirements sought to expand in the suburbs, while today we see nearly 35 percent of all tenants looking for larger spaces. Comparatively, in the CBD, the share of growing, shrinking, and expanding tenants is more or less the same today as it was twelve quarters ago.

• Organic internal growth has driven much of the demand in the suburbs. As one recent example, CSL Behring recently signed a 100,000 square foot lease at 500 North Gulph Road, in addition to their 257,000 square foot King of Prussia location. The Philadelphia Insurance Company grew to 285,000 square feet from its previous 250,000 square foot presence in Bala Cynwyd. Occupiers and landlords alike will pay attention to whether this is a sign of a new normal. Armed with a massive economic stimulus from the Trump tax cuts, we expect tenants to continue to grow their real estate footprints.


Source: JLL Research




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