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Though office demand declined slightly at the beginning of the year, vacancy rates dropped to their lowest levels in seven years and rental rates continued to climb in Q2.
BOMA VP Bob McClure says the uptick in occupancy is due in large part to the co-working culture that is taking the industry by storm.
In its 2016 Experience Exchange Report, BOMA reports that the average office occupancy rate was 89.88% in 2015, with tenants taking on average 7.7k SF.
“The findings this year were very positive. The average rate has been going up since the recession in a continuous climb,” Bob tells Bisnow. “An interesting stat is the SF per office worker grew last year even though the general trend over the last 10 years has been a decline.”
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The EER—which includes data from more than 5,200 buildings throughout the US and Canada that accounted for almost 900M SF—found that on average office workers occupied almost 310 SF/person last year.
“What we find happening is that while the area that may be surrounding [employees] at work has shrunk, the actual space per employee has not because employers have added different amenities [that provide] more open and collaborative spaces for folks to use,” Bob (pictured, surrounded by BOMA staff) tells us.
The co-working culture continues to revolutionize the office industry and companies like the $16B co-working giant WeWork are still expanding globally.
On another note, rental rates remained healthy last year, averaging $28.21/SF, BOMA reports. “The total rental income is very healthy with base rents that have also been improving as the economy has improved," Bob says.
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