United States office outlook – Q3 2019 

Rapidly growing tech and creative tenants are finally moving into newly delivered space, leading to a short-term drop in vacancy

October 16, 2019

Fundamentals in the U.S. office market remained solid in the third quarter, albeit with early signs of a slowdown becoming apparent. High-growth tech, creative and life sciences tenants continued to drive occupancy gains, while the coworking sector experienced tapering growth with more friction expected ahead. Despite new supply hitting the market, vacancy currently rests at just 14.2% nationally, while fewer completions led to yet another strong quarter for absorption. Tenants can expect limited availability of top-end options as the flight to quality continues and large-scale occupiers take advantage of effective rent compression and residual space in speculative construction delivering through 2022 and 2023.

Click through the tabs below to compare market performance across key categories.

Rental rates ($)

Asking rents rose by 0.9% over the quarter on aggregate, although faster growth in concessions is eating into effective rents.

Market Rental rates ($)
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Net absorption (s.f.)

Year-to-date absorption surpassed 50 m.s.f. on the back of expansion into new space and a slower quarter for deliveries.

Market YTD net absorption (s.f.)
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Vacancy (%)

Vacancy dropped to 14.2% in tandem with a temporary spiked in occupancy growth.

Market Total vacancy (%)
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Under construction (s.f.)

The pipeline is now roughly 118 m.s.f., but is likely to start decreasing as large-scale developments hit the market in 2020 and 2021.

Market Under construction (s.f.)
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United States office property clock
JLL Office Outlook clock (image)

Source: JLL

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United States office outlook – Q3 2019

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