Rightsizing and flight to quality driving leasing activity

  • Jacob Rowden
  • In every major industry except for technology, most of the largest office tenants have downsized their office footprints since the end of 2019.
  • Reductions have generally been moderate and notable outliers have invested significantly in office space over the last three years.
  • The propensity of large office users to relocate into higher-quality product over the last several years has led to higher average rental rates across their portfolios. So despite a net reduction in leased space, higher per-square-foot pricing has muted the impact on tenants’ total cost of occupancy.