2023 Q1 Occupier Outlook Office

Flexibility is a Valuable Commodity. 

As office-occupying companies vacillate between edicts of returning to the office and work-from-home models, organizations are taking a measured approach. While overall lease rates have remained flat, concessions and robust TI packages are lowering the nominal rent. The market will likely begin to soften further as more pre-pandemic signed leases begin to roll. Some US markets, particularly Sun-Belt and highly-diversified industry markets, have fared better than others.  Many occupiers are hesitant to sign long-term leases, pausing to better understand the economic landscape and long-term employee working strategies.

Office Occupier View: 
  • Newer, well-amenitized buildings are still in demand as occupiers are willing to pay more on a per square foot basis for a space that will incentivize employees to return-to-the-office.
  • Tenants in the market are finding longer times to find spaces as they navigate the financial health of buildings and landlords. 
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