Sublease vacancy up year-over-year across most of the Philadelphia region
Valley Forge, Delaware County, and New Castle County have seen the biggest increases over the past year
April 09, 2021
Largest increases in sublease space by submarket
- An analysis of the 27 tracked submarkets in the Philadelphia Region shows that 19 out of 27 have experienced increases in sublease vacancy, three have decreased, and five have remained constant. Of the 27, nine have sublease vacancy rates greater than the market rate of 1.8%.
- The largest increases occurred in the Valley Forge / Norristown, Delaware County, and New Castle County submarkets due to Optum vacating its space at 1001 Adams Avenue, PNC Bank vacating space at 8800 Tinicum, and Farmer’s Insurance leaving 3 Beaver Valley, respectively.
- Sublease vacancy has more than doubled in nine submarkets. Notably, Conshohocken experienced a seven-fold increase due to Oracle subletting 29,150 s.f. at Five Tower Bridge and Comcast subletting 18,375 s.f. at Four Tower Bridge.
- No part of the Philadelphia Market has been spared from this trend. Dun & Bradstreet vacated 54,000 s.f. at 3501 Corporate Parkway in the Lehigh Valley. Teknion vacated 29,650 s.f. at 350 Fellowship in Mount Laurel, and Magee Memorial Hospital vacated 19,099 s.f. at Suburban Station.
- More sublease vacancy coupled with increased sublease availability will drive overall asking rents down as direct space is forced to compete in a market faced with increasing supply and depressed demand.