More companies are expanding their footprints than contracting, according to new research from CBRE, suggesting tenants may have more long-term confidence in the market than would appear at first glance.
Data from the first three quarters of 2021 shows that office tenants in major US markets shifted to more relocations and expansions and focused less on status-quo lease renewals and space contractions.
Expansions in primary markets—Manhattan, Boston, Chicago, Washington, D.C., Los Angeles and San Francisco—climbed to 24% by square footage last year from 17% in the final three quarters of 2020, while relocations within the market increased to 33% from 23%. In those cities, "relocations reflected a flight-to-quality trend—especially in primary markets like Manhattan and Washington, D.C.—that supports tenants' efforts to attract employees back to the office more regularly," the report notes.
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