Boston Ranked as #4 Market for Its Share of 100 Largest U.S. Office Leases by Tech Firms

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Kevin Kennedy

Boston – Boston claimed the fourth-largest share of square footage in the 100 largest U.S. office leases by tech firms last year, remaining relatively steady at a 2 percent increase from the previous year, according to a new report from CBRE’s Tech Insights Center.

“Despite Boston’s modest increase in tech firm square footage, the market continues to see home-grown firms expanding and new firms entering the market,” said Kevin Kennedy, Senior Vice President at CBRE in Boston. “Boston’s established tech market, steady flow of graduates from its world-renowned colleges and universities, and the market’s new development continue to attract and retain tech firms.”

CBRE’s analysis found that the software, search and e-commerce categories together accounted for 62 percent of the square footage in last year’s largest U.S. 100 tech office leases, up from a collective 41 percent share in 2018. The gains made by those three tech sectors came as large-scale leasing activity by companies involved in social media, hardware, business services, cloud and media & entertainment industries, lessened compared to previous years.

On the market level, the San Francisco Bay Area remained the capital of huge tech leases with 6.9 million sq. ft. newly leased last year, but its share of square footage in the largest 100 leases declined by 37 percent in 2019 from a year earlier as tech companies expanded to other markets, largely in search of talent.

“The largest tech firms have diversified their expansion plans so that they’re no longer overly dependent on one or two markets for hiring talent,” said Colin Yasukochi, Executive Director of CBRE’s Tech Insight Center. “Many East Coast markets like New York and Washington, D.C. offer large tech-talent labor pools and a steady flow of tech-degree graduates. Given the tight labor supply and cost pressures in the Bay Area and Seattle – the two largest U.S. tech markets – the diversification trend can be expected to continue.”

Tech Tally: Which Markets Claimed the Most of the Largest 100 Tech-Office Leases of 2019

Market Share of square footage in largest 100 office leases by tech firms Percentage change 2019 from 2018
San Francisco 6.9 million -37%
Manhattan 4.9 million 148%
Seattle 3.3 million 63%
Boston 1.2 million 2%
Washington, D.C. 1.1 million 37%
Dallas-Fort Worth 959,301 -15%
Los Angeles 955,453 -54%
Phoenix 727,174 NPR*
Nashville 621,596 NPR*
Chicago 596,497 -55%

*Not Previously Ranked: Percentages not available because Phoenix and Nashville weren’t represented in the 2018 ranking.

To download the full report, click here.