BOSTON– Avison Young released its Third Quarter 2022 Office Market Report for Boston, saying the office market in Boston is currently driven by record sublease availability and flight to quality.
Key takeaways from this quarter’s report indicates that sublease availability has reached a record level in Boston of 3.6 million-square-feet (sf) and that over one million-sf of preleasing commitments in Boston’s newest office towers could leave large blocks of vacant space behind when the new space is ready for occupancy in the next 12 to 18 months.
“In an effort to coax their employees to return to the office, leaving behind the comforts of home offices, and in an effort to attract and retain top-tier talent, companies are recognizing that they have to either improve their existing space or find new space in amenity rich building equipped with the latest health and wellness infrastructure,” said Tom Collins, Principal and Managing Director of the firm’s Boston office. “Another factor driving the market is that 4.6% of the existing inventory is sublease space, which is at record levels, higher than during the Great Recession—many large companies like Wayfair and Reebok are consolidating and giving back space.”
The report also points out that shortages of labor combined with rising costs are impacting new construction and tenant buildouts, underscoring that both landlords and occupiers are committed to improving the quality the buildings and the tenant workspace within.