Where Office Development is Happening

Looking at Boston, you might never guess the U.S. office market is supposed to be in bad shape. In this city, 14.6 million SF of office space is under construction – more than double that of its closest competitor, San Francisco, and adding 5.9% to Boston’s existing office inventory.

Other metros are also seeing significant increases in office space under construction. They include San Francisco (7 million SF), Seattle (5.9 MSF), San Diego (5.1 MSF) and Austin (4.9 MSF). In all, 19 major cities are watching massive new office buildings arise in their midst, according to an analysis by CommercialCafe. Nationally, 97 MSF of office space is currently in various stages of development, the company noted – 28% less than in 2023.

While Boston may be adding the most space – largely thanks to its blossoming life sciences industry — it is not adding the largest structures. That prize goes to Manhattan, where the 22-story 4 Hudson Square is due to be delivered this year. Owned by Walt Disney, the 1.3 MSF edifice will house up to 5,000 of the company’s employees. The building will include offices, production studios, a newsroom, executive spaces, a screening room, and outdoor terraces. Disney’s current Manhattan HQ, First Battery Armory, is now up for sale.

Another huge project, the $2 billion Terminal Warehouse Redevelopment, is also under way in Manhattan. Originally constructed in 1891, the structure has been “creatively reimagined” with 1.3 million rentable square feet of warehouse office space and retail in the West Chelsea historic district. It includes 100,000 SF of outdoor and green space oriented toward the New York waterfront, “accentuating [the structure’s] defining features: brick, timber, windows and iron,” according to the developers L&L Holding Company, Columbia Property Trust and Cannon Hill Capital Partners.

In spite of these two developments, Manhattan — with just 3 MSF — only ranked ninth in office space under construction, due to delays and halts to potential projects.

On the West Coast, major developments are under way. The largest, Sacramento’s Richards Boulevard Office Complex, is being developed by the California Dept. of General Services for its own use; completion this year is expected. The $940 million, 1.25 MSF complex of four office towers is sprawled across 17.3 acres in the city’s River District. In addition to office space, trees dot a landscape with walkways and a central public open space offers a “town square” for public use, along with a childcare play facility.

Other large California offices due for delivery this year are three buildings at Kilroy Oyster Point in San Francisco, Intuitive Surgical South in Sunnyvale, and the RaDD life sciences district in San Diego.

Seattle is also the site of four large office complexes under construction, some with ties to Amazon. The largest is Tower 1 at Bellevue 600. This 43-story skyscraper is being built by Amazon to house some of its 10,000 workers in the area. It will reportedly include 30,000 SF of retail and other facilities. Another new Bellevue landmark is West Main, consisting of 1.04 MSF of office space in three mixed-use buildings with open green spaces along with 33,000 SF of retail. Two other Seattle office projects in CommercialCafe’s top 20 listing are The Artise, also in Bellevue, and Costco’s 999 Lake Drive in Issaquah. In total, CommercialCafe reported, the new buildings will add four MSF to the metro’s office stock.

The remaining top 20 are scattered across the country.

In Cleveland, Sherwin Williams is constructing a new HQ downtown. The 36-story building boasts 1 MSF to host its 4,000 employees along with a two-story pavilion. CommercialCafe notes that the property is part of a wider development plan that includes a 600,000 SF Global Research and Development Center in Brecksville, OH that is nearing completion.

In Philadelphia, another 1 MSF life sciences campus in six buildings is under way. The $250 million Quartermaster Science & Technology Park will include wet and dry lab space for both life science startups and established companies to conduct full-scale research and development, and bio-manufacturing, according to its developers.

Denver is awaiting completion of a 30-story, 720,000 SF office project, 1900 Lawrence. And in Miami, 830 Brickell will add another landmark to the city.

But not all ends well. In Charlotte, NC another $1 billion office project, 1030 Centene Court, is nearing completion. But there’s little to celebrate for the city. St Louis-based Centene, a managed health care company, announced in 2020 plans to build a six-building East Coast HQ in Charlotte, helped by generous incentives. In 2023, with the work almost completed, Centene pulled out of the arrangement, saying it was acknowledging the reality of the remote work trend, leaving the buildings finished but without tenants.

“Workplace flexibility is essential to attracting and retaining our top talent,” Centene said.