The area ranks third nationally, behind Manhattan and Atlanta, in demand for office space with 8 million sf of net leasing. It also sits high in the Class A rental rates list at $54 per sf, just behind San Francisco and Boston. Silicon Valley's 2.43% rental vacancy rate, places it second in that category, trailing Seattle's 1% vacancy rate.
The average rental rate for central business district Class A space across North America's office markets leaped 6.9% to $22.72 over the past six months, 9.3 % compared to a year ago.The average rental rate outside CBDs is now $23.96, up 3.5% this year and 5.9% over the past 12 months.
Silicon Valley residents can't look to suburbia for relief. The average rental rate there increased by 92% or $33.40 as space scarcity grew in more urban areas. At $70 per sf., Silicon Valley has North America's highest average rental rate. Nearby San Francisco suffered rents climbing an average of $18, a 35% increase in the city's CBD over the past six months.
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