Suburban offices are officially outperforming urban assets for the first time, with vacancies in central business districts far outweighing suburban rates — but hope is on the horizon in the long term.
According to a new report from Colliers, the rise in CBD vacancies is "probably a temporary trend, not a structural market shift," noting while that office markets with the strongest growth in the Southeast and Southwest tend to be suburban driven, "the amenities of CBDs and urban cores should eventually lure back occupiers."
"Until this demand rebounds, it won't be clear whether suburban outperformance is temporary," the report notes. "Office conversions will also help reduce the denominator in CBDs, further suppressing vacancies in the years to come."
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