More office leases are being signed today than before the pandemic, and leasing activity is expected to increase later this year and into 2025 as occupiers gain confidence in making real estate decisions amid a resilient economy.

Occupiers signed 3,166 office leases during the first half of this year, which compares with an average of 3,136 during the first half of 2018 and 2019, according to CBRE's first-half office leasing data. However, the average lease size dropped 27% compared with pre-pandemic lease sizes, a trend CBRE attributed to economic uncertainty and structurally lower demand due to hybrid work.

As office leases tick up, driven by the legal, technology and finance sectors, occupiers are favoring renewals over relocations. Renewals accounted for 42% of office lease transactions during the first half compared with 31% before the pandemic. The average lease size for renewals fell by 21%, said CBRE.