Q2 2019 Salt Lake City Market Report

The Salt Lake City Metropolitan Office Market continues to grow.  Healthy 
demand from both existing companies expanding and enterprises new to the market continue to fuel the need for new Suburban Class "A" space.  
Additionally, construction of 95 State at City Creek, Downtown Salt Lake 
City's newest 25-story high-rise, was formally announced.  It will add 500,000 SF of new Class "A" office space to the market in late 2021. The technology, finance, healthcare and flex/co-working space sectors are driving the bulk of new occupancy.  
Asking lease rates continue to climb and now average $27.72/SF, full service in Class "A" and "B" properties combined market-wide. The overall strength of the market, increasing construction costs and land prices, together with 
increasing operating expenses, most notably in property taxes, continue to 
push rates higher.
Over the next 18 to 24 months, demand for just-in-time flexible work 
environments will increase. WeWork and other co-working providers will likely bring an additional 300,000 to 400,000 SF online to meet this increasing 
demand.
One mild concern to monitor moving forward is the increase in sublease space entering the market.  If this continues or the pace accelerates, it could slow 
the pace of new construction and lease rates may flatten. But it would also 
add more competitively priced opportunities for tenants.