CHICAGO—The American economy continues to expand and the national office market grew along with it in the second quarter, according to a new report from JLL. The Chicago-based firm found that leasing activity increased from 54 million square feet in the first quarter to 64 million square feet in the second, an uptick of 17%. In addition, 40% of second quarter office transactions of more than 20,000 square feet were occupier expansions. This was the fourth consecutive quarter that saw expansions in 40% to 50% of such leases.

“This is a shift away the years following the recession in which tenants were largely renewing, and in many cases downsizing, in place,” Julia Georgules, vice president of US office research for JLL, tells GlobeSt.com. “Now, tenants are increasing their headcount and occupancy as the economy continues to grow.”

“We now have the largest pipeline of development underway in eight years,” she adds, largely driven by the significant rise in leasing activity. The current pipeline will eventually produce about 35 million square feet. “However, the bulk of that won't come online until 2016, so tenants will continue to feel supply constraints through the remainder of 2015, leading to further tightening of vacancy across markets.”