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The Boston Bruins and the St. Louis Blues are tied in the Stanley Cup Finals, but the two cities have very different standings when it comes to their respective commercial real estate sectors.
St. Louis’ leading industries include manufacturing, aviation, life science and multimodal logistics. Business in Boston is dominated by the life science, healthcare, higher education, professional services and technology sectors.
The Gateway to the West’s 141M SF office market comes up short of Boston’s 207M SF. Rents and the development pipeline in St. Louis are also less than in Boston, which has an average asking office rent of $41/SF and 4.6M SF of office currently under construction.
Average office rents in St. Louis run $20/SF, and only 1.5M SF of product is under construction.
“Despite the high cost of living and business here, the Greater Boston market has been putting more pucks in the net all year in terms of companies relocating here, IPOs and overall funding,” Boston-based Avison Young Senior Research Analyst Tucker White said. “Oh yeah, and we are two-for-two in championships so far this year. Sometimes you need to pay up to win.”
But St. Louis trounces Beantown in industrial. Missouri’s largest city has a 304M SF industrial inventory compared to Boston’s 207M SF. Industrial vacancies are lower in St. Louis (5.1%) compared to Boston (7.7%), and there is significantly more product expected to deliver.
Nearly 5M SF of industrial is under construction in St. Louis compared to 1.5M SF in Boston.
“Boston may have St. Louis beat when it comes to office and rents but we Zamboni them in the industrial market,” St. Louis-based Avison Young principal Gerard Mudd said. “And talking about rents, why pay two times the rate for office in Boston when you can move to St. Louis and still have four seasons, but not the snow?”
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