Q1 2014 | OFFICE
NORTH AMERICA
HIGHLIGHTS
The Rise of the Sun Belt
ANDREA CROSS National Office Research Manager | USA
MARKET INDICATORS
Relative to prior period
US
Q1
2014
VACANCY
NET ABSORPTION
CONSTRUCTION
RENTAL RATE**
US
Canada Canada
Q2
Q1
Q2
2014* 2014 2014*
















*Projected | Construction is the change in Under Construction
**Rental rates for current quarter are for CBD. Rent forecast is
for metro-wide rents.
NORTH AMERICAN OFFICE MARKET
Summary Statistics, Q1 2014
US
CAN
NA
VACANCY RATE (%)
13.90
8.05
13.49
Change From Q4 2013 (%)
-0.11
0.19
-0.09
ABSORPTION (MSF)
13.2
0.3
13.5
NEW CONSTRUCTION (MSF)
15.6
2.0
17.6
UNDER CONSTRUCTION (MSF)
70.8
21.3
92.1
ASKING RENTS PER SF
US
CAN
Downtown Class A ($) 44.24
50.13
Change from Q4 2013 (%)
2.64
-0.46
Suburban Class A ($)
27.17
32.24
Change from Q4 2013 (%)
1.18
1.00
WWW.COLLIERS.COM
KEY TAKEAWAYS
• North American office vacancy decreased by 9 basis
points in Q1 2014 to 13.49%, on par with the rate of
recovery during the last few years. Steady job growth is
driving demand, but tenants’ more efficient use of space
is limiting occupancy gains relative to previous cycles.
• ICEE markets continue to lead office market recovery.
Vacancy in the primary ICEE markets decreased by 26
bps this quarter, vs. just 4 bps in the primary FIRE
markets.
• Sun Belt markets also are key drivers of the current
recovery. Despite accounting for only about 30% of
U.S. office inventory tracked by Colliers, the Sun Belt
represented nearly 60% of Q1 office absorption.
• Construction activity in the U.S. remains low and is
concentrated in markets with the strongest demand, e.g.,
Boston, San Francisco, Silicon Valley. Space under construction
in U.S. and Canadian markets tracked by Colliers totaled 92.1 million
square feet in Q1 2014, up from 88.2 million square feet in Q4 2013
and 74.4 million square feet in Q1 2013.
• Domestic and foreign capital continues to target North American office properties: According
to Real Capital Analytics, combined transaction volume in the U.S. and Canada increased by
36% year-over-year in Q1 2014. Demand is still strongest for assets in CBDs and major metros,
although we anticipate rising activity in suburban and secondary markets due to the broadening
economic and office market recoveries, and higher yields on properties in those areas.
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
OFFICE VACANCY, INVENTORY AND ABSORPTION | Q1 2014 | NORTH AMERICA
T SUN
EL
BE
NB
LT
U
S
Absorption Per Market (SF)
Q4 2013 - Q1 2014
SU
NBELT
SUNBE
LT SUNB
ELT SUNBEL
T SUNBELT SUN BELT
SUNBELT
2,000,000
ELT
SUNB
NBELT
SUNBELT SU
1,000,000
200,000
-200,000
-1,000,000
-2,000,000
Square Feet By Region
2 billion
1 billion
200 mil.
Occupied Sq. Ft.
Vacant Sq. Ft.
U.S. Economic Trends
The U.S. economy began 2014 on a weak note, with severe weather
conditions throughout much of the nation. The term “Frozenomics” was
coined to describe the resulting negative economic impact. At the time,
we believed the damage from Frozenomics was overblown and would be
short-lived, and our prediction has been borne out by recent economic
data. According to the Bureau of Labor Statistics (BLS), the U.S. economy
added 288,000 jobs in April 2014, the highest monthly total since January 2012; also, job creation figures for February and March were revised
upward by a total of 36,000. We regularly caution that BLS employment
statistics are revised multiple times—often substantially—but, in this case,
payroll processing firm ADP’s recent data on actual payroll statistics from
20% of the nation’s private-sector companies mirrors the BLS data. ADP
reported steady acceleration in monthly job creation in early 2014, from
121,000 jobs added in January to 220,000 jobs added in April, with the
four major geographical regions all exceeding their respective six-month
trailing monthly averages.
Looking specifically at office-using employment, the bifurcated recovery
continues, with strong growth in professional and business services propelling nearly all of the growth in office demand during the current recovery. Moreover, professional and business services growth accelerated
through early 2014, with 77,000 jobs created in April—the highest total
since late 2012, according to ADP data. Technology-related employment
was the primary driver of this growth earlier in the cycle, but other comP. 2
| COLLIERS INTERNATIONAL
CHANGE IN EMPLOYMENT FROM CYCLICAL PEAK | US
6%
4%
2%
0%
-2%
-4%
-6%
-8%
-10%
0
4
8
12 16 20 24 28 32 36 40 44 48 52 56 60 64 68 72 76 80 84 88
MONTHS
Total Employment
Office-Using Employment
Professional & Business Services
Financial Activities
Latest data as of April 2014; x-axis indicates number of months elapsed since each sector’s previous
cyclical employment peak; office-using employment sectors include professional and business services,
financial activities and information services; information services not displayed separately because sector
peaked in 2001 | Sources: Bureau of Labor Statistics, Colliers International
ponents of this sector, such as legal and accounting, have been adding
jobs during the last 12 months, albeit at a modest pace. Recent data from
Thomson Reuters indicated an increase in law firm transaction activity
among 70% of the 150 large firms surveyed in Q1 2014, compared with
just 32% one year earlier—a positive sign for this important component
of office demand. Financial activities, the other primary component of
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
economic growth in Canada. The Conference Board expects improved
private investment activity in 2014, but relatively low when compared
with historical levels.
OFFICE MARKET | Q1 2012–Q1 2014 | US
14.95 14.78 14.73 14.63
14.49 14.45 14.15
14.00 13.90
20.0
16.0
14.0
12.0
10.0
15.0
8.0
10.0
6.0
Vacancy %
25.0
4.0
5.0
2.0
0.0
Q1 2012 Q2
Q3
Absorption MSF
Q4
Q1 2013 Q2
Completions MSF
Q3
Q4
Q1 2014
-
Vac Rate (%)
Source: Colliers International
office-using employment, remains weak, although the sector does appear
to have bottomed. Other than a decrease in January, the financial activities sector has not lost jobs on a monthly basis in more than three years,
according to ADP.
In 2014, we expect the U.S. economic recovery to occur at a similar rate
as in 2013, with steady but unspectacular job creation averaging less than
200,000 per month. However, the economy should gain steam as the
year progresses compared with the Frozenomics-driven weakness at the
beginning of the year. Given the second estimate of a 1.0% decline in GDP
in Q1 2014, we expect GDP growth of less than 2.0% during 1H 2014.
However, growth should accelerate during the year, supported by greater
business and consumer confidence, the carry-forward effect of purchases delayed due to weather conditions earlier in the year, and incremental
improvements in state and local government finances. Thus, we expect
healthy 3.0% GDP growth in 2H 2014, resulting in annual GDP growth in
the 2.5%–2.75% range.
Canada Economic Trends
Like the U.S., Canada was not immune to the bad weather effect in Q1
2014. GDP expanded by 1.7%, well ahead of the U.S. rate, but still a slowdown from 2.9% in Q4 2013. Similar to the U.S., we expect stronger GDP
growth through the rest of 2014 as the temporary negative effect of the
weather dissipates. For the year, the Canadian economy will likely mirror
the trend of the last few years, expanding at a modest rate. The Conference Board of Canada projects 2.3% GDP growth, a slight increase
from 1.7% in 2013 and lower than our expectations for U.S. economic
growth. However, it is important to note that the Canadian economy experienced a shallower and shorter recession than the U.S., and several
years ago recovered all of the jobs lost during the downturn. Canada is in
the midst of a moderate expansionary period rather than the protracted
recovery occurring in the U.S. For 2014, the withdrawal of fiscal stimulus measures implemented in response to the recession, coupled with
a cautious outlook among private sector firms, will likely prevent faster
Office Outlook 2014:
Behind the Statistics &
Beyond the Basics
Scope of Colliers’ Office Outlook Report: Colliers’ office space universe
encompasses 87 markets in the U.S. and Canada, totaling more than 6.4
billion square feet. The 75 U.S. markets account for nearly 6.0 billion
square feet of tracked inventory, with the remaining 446 million square
feet in Canada. Our coverage includes 21 markets with more than 100
million square feet of space, which combined account for 3.8 billion
square feet, or nearly 60% of our office market inventory. The largest
U.S. markets are New York, Washington, D.C., Chicago, Dallas and Atlanta; Toronto is the only Canadian market with more than 100 million
square feet of space.
VACANCY
Vacancy rate trends in Q1 2014 mirrored those observed during the last
few years. The slow but steady economic recovery, coupled with low
levels of new supply, supported an 11 basis-point decrease in the U.S.
vacancy rate, to 13.9%. Once again, the Canadian vacancy rate increased
during the quarter as additional new supply came to market. Although
Canada’s vacancy rate rose above 8%, it remains well below the 10%
threshold reflective of a healthy market.
Intellectual capital, energy and education (ICEE) markets remain the leaders in the office market recovery. The vacancy rate in the primary ICEE
markets decreased by 26 basis points during the quarter, compared with
just a 4 basis-point decrease in the vacancy rate of the primary FIRE
markets. ICEE markets still top the list of tightest markets, including Bakersfield, Pittsburgh, Calgary and San Francisco. However, many markets without significant clusters of ICEE industries are improving as well,
mirroring the broader economic recovery. Grand Rapids, Hartford and
Downtown Manhattan were among the markets with the largest decrease
in vacancy rate. Albuquerque, a laggard in the current recovery due in
part to its dependence on federal government spending, also ranked high
in terms of quarterly vacancy rate decrease, as did former housing-bust
markets Fresno and Stockton.
We are also observing an increasing amount of tenant spillover from the
leading tech markets and submarkets, in which rents have increased
significantly in recent years, to adjacent, lower-cost areas with greater
availabilities. Northern California’s East Bay is finally experiencing some
tenant spillover from Silicon Valley and San Francisco, where rents have
skyrocketed and the number of large blocks of available space has diminished. Several tenants in the health care, non-profit and gourmet
food sectors left San Francisco recently for the lower rents and/or larger
spaces available in the East Bay; and both Oakland and Walnut Creek
COLLIERS INTERNATIONAL |
P. 3
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
Source: Colliers International
LOWEST OVERALL VACANCY RATES | Q1 2014 | NA
MARKET
VACANCY (%)
MARKET
VACANCY (%)
Toronto, ON
5.92
Winnipeg, MB
8.46
Saskatoon, SK
6.22
Vancouver, BC
8.68
Montréal, QC
7.24
Calgary, AB
8.71
2.0
Bakersfield, CA
7.29
New York, NY –
Midtown South
8.83
1.5
Pittsburgh, PA
8.09
Nashville, TN
9.15
1.0
NORTH AMERICA: 13.49%
2.5 MSF
0.5
0.0
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Ho
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NY
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,
Yo
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Ne
Also expected to drive the spillover trend is the increased desirability of
residential neighborhoods in areas such as Oakland and Brooklyn. Many
companies are seeking to locate near where their employees want to
live, and many millennials have been priced out of, or prefer to live in,
n,
TX
Source: Colliers International
TOP MARKETS FOR METRO OFFICE ABSORPTION | Q1 2014 | NA
l
-9
tra
13.58%
N
13.49%
en
NORTH AMERICA
,M
-59
-C
16.67
lis
16.07
ey
Atlanta, GA
Although a broader range of industries have been adding jobs in recent
quarters, the ICEE industries remain the dominant force in the office
market. Absorption in the main ICEE markets outpaced absorption in the
major FIRE markets by more than four to one in Q1 2014. Houston alone
accounted for more than one-quarter of the 8.6 million square feet of absorption in the ICEE markets, posting its highest quarterly absorption total
since Q2 2007. Energy companies continue to drive the Houston market,
accounting for nearly 80% of leasing activity in Q1 2014, as high oil prices
support the industry’s growth.
rs
-65
Je
16.23
w
15.57
AZ
Walnut Creek, CA
ABSORPTION
x,
-76
ap
o
13.50
ne
12.74
in
Fresno, CA
M
-86
Ne
19.28
D
18.42
M
Albuquerque, NM
ni
-91
Ph
oe
9.74
n
8.83
ow
New York, NY –
Midtown South Manhattan
nt
-103
m
or
e,
10.73
lti
9.70
Ba
Ottawa, ON
A
-112
ow
15.55
-D
14.43
Y
New York, NY –
Downtown Manhattan
k,
N
-163
TX
12.44
la
nt
a,
G
10.81
At
San Jose – Silicon Valley
Yo
r
-167
w
14.49
Ne
12.82
A
Hartford, CT
s,
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M
20.72
lla
18.36
Da
Grand Rapids, MI
MSA
With modest economic growth still occurring in Canada, the increase in
the vacancy rate in recent quarters was primarily the result of more efficient space utilization by tenants, as well as the large amount of new
supply coming to market. The demand drivers vary by metro area, but—
as in the U.S.—ICEE firms continue to boost demand for space in core
markets. In Calgary, for example, where nearly 70% of office construction in Canada was delivered in Q1 2014, demand from energy companies
seeking large blocks of space remains robust even though the vacancy
rate increased slightly during the quarter. In Vancouver, digital media and
technology firms remain active, as well as firms entering the Vancouver market for the first time. Microsoft and Sony recently signed large
deals for high-quality space in downtown Vancouver. Overall, demand has
stagnated somewhat, but this is primarily due to tenants delaying leasing
decisions until the large amount of supply under construction starts to
hit the market. Some concern remains regarding the impact of this new
space on vacancy in Class B buildings and older Class A buildings.
h
BASISPOINT
CHANGE
on
,
VACANCY
RATE (%)
Q4 2013
st
VACANCY
RATE (%)
Q1 2014
So
ut
LARGEST Q-o-Q DECREASE IN OVERALL VACANCY RATE | NA
neighborhoods that historically were less desirable than core, central city
locations like San Francisco and Manhattan. Etsy, Inc. is expanding its
Brooklyn presence, moving its headquarters into 200,000 square feet in
the DUMBO neighborhood, and has plans to nearly double the size of its
workforce. Vibrant, walkable areas proximate to transit, in core markets
as well as in emerging neighborhoods and office markets, will benefit
from these trends.
Bo
posted vacancy rate decreases in Q1 2014. In Chicago, mobile marketing firm Punchkick Interactive will relocate from River North, one of the
metro area’s leading tech submarkets, to the nearby East Loop later this
year. With technology tenants driving up rents in the hottest tech markets,
we will likely see more tenant spillover into other submarkets by both tech
and non-tech tenants.
Source: Colliers International
P. 4
| COLLIERS INTERNATIONAL
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
As the recovery progresses, shortages of space are emerging in certain submarkets, or for some
sizes or classes of space in metro areas that have been slow to recover overall. For example, in
Sacramento, which still has an 18+ percent vacancy rate, tenants leased half of the blocks of space
containing 100,000 square feet or more between mid-2013 and the end of Q1 2014, leaving few contiguous options for large users. However, options for smaller and mid-sized users remain abundant.
Although the economy continues to improve, many companies remain highly cost-conscious, as reflected in their real estate decisions. We continue to see large companies dividing functions into multiple geographical locations in order to reduce operating expenses, affecting office market dynamics
across the United States. Within the financial services industry, many major banks have been moving
mid-level and back-office functions to lower-cost locations in the South and Midwest. As of April
2014, financial activities employment exceeded pre-recession peak levels in many metro areas within
these regions, even in hard-hit housing markets such as Jacksonville, due to financial companies including Deutsche Bank, Goldman Sachs, Credit Suisse and BNY Mellon expanding operations. We are
seeing a similar trend in non-financial industries as well. For example, GE recently announced plans
to consolidate 1,400 employees, including human resources, IT, accounting and procurement professionals, into a new Global Operations Center in the Cincinnati area by 2017. Many of the employees
will come from outside of Cincinnati, and the facility eventually could house up to 2,000 employees
in total, resulting in substantial net job creation in the area from just this company. In KPMG’s most
recent Competitive Alternatives study, Cincinnati ranked second among large metro areas in terms
of business costs, and indeed we are seeing strong job creation in many of the markets at the top
of these rankings. We expect that low costs of doing business, coupled with aggressive company
recruitment through tax and other incentives by states such as Texas, will result in continued tenant
movement from higher-cost metros.
Consolidations and reconfigurations of space throughout the public and private sectors continue to
limit office absorption. The General Services Administration (GSA) remains among the most aggressive in terms of downsizing, exemplified by its April renewal for 217,313 square feet in College Park,
GA, for the Federal Aviation Administration’s Southern Regional Office. The GSA plans to relocate an
additional 330 employees from another space at which its lease is expiring, bringing the College Park
location’s headcount from less than 700 to about 1,000. With a federal budget in place, the GSA is beginning to deal with the backlog of expiring leases that built up during the last few years; one-quarter
of all federal leases are set to expire in 2014. However, the agency will continue to utilize denser
configurations and reduce its real estate footprint in order to cut real estate costs. Efficient buildings
capable of handling high employee densities are in demand, potentially at the expense of incumbent
buildings. The federal government is also looking to better utilize its real estate portfolio, moving
some employees out of leased space into owned space. For example, the Department of Veterans
Affairs recently announced plans to move 800 employees out of leased space in downtown St. Louis
into a GSA-owned building in suburban Overland, MO.
Private-sector firms are attempting to cut costs as well, through more efficient space utilization—
although the potential for this varies by industry and the individual tenant’s needs. Firms are using
technology to monitor desk utilization rates, with some reporting less than 50% of workspaces used
during business hours, indicating significant potential for increasing densities through the use of
shared spaces. Many firms are reporting a desire for shorter, more flexible lease terms in order to
respond to ever-changing technologies and uncertain business conditions.
CONSTRUCTION ACTIVITY
Construction trends reflect where the U.S. and Canada are respectively in the office market cycle.
Outside of the strongest metro areas and submarkets, construction activity remains low in the U.S.
due to more efficient tenant space usage, elevated vacancy rates and high construction costs. Canada’s economic expansion, on the other hand, is driving a large amount of construction activity, and
new supply is just starting to hit the market in many metros.
North American Downtown Markets:
Excluding renewals, of the leases signed
this quarter in your CBD/downtown, did
most tenants...?
Expand
11.69%
Contract
11.69%
Hold Steady
70.13%
North American Downtown Markets:
What was the trend in Free Rent (in months)
offered by CBD landlords this quarter?
Less
13.04%
Same
81.16%
More
5.80%
North American Downtown Markets:
What was the trend for tenant improvement
allowances offered by CBD landlords this
quarter?
Less
11.59%
More
7.25%
Same
81.16%
North American Suburban Markets:
Excluding renewals, of the leases signed
this quarter in your suburban market, did
most tenants...?
Expand
26.03%
Contract
8.22%
Hold Steady
65.75%
Charts above reflect % of markets reporting
COLLIERS INTERNATIONAL |
P. 5
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
TOP MARKETS FOR OFFICE SPACE UNDER CONSTRUCTION | Q1 2014 | NA
16 MSF
CONSTRUCTION AS % OF EXISTING INVENTORY | Q1 2014 | NA
SQUARE FEET
UNDERWAY
MSA
14
12
Calgary, AB
10
Vancouver, BC
% OF EXISTING
INVENTORY
6,678,741
10.08
4,140,952
7.68
15,052,344
7.17
5,381,410
6.06
5.78
6,799,062
4.83
0
Regina, SK
200,000
4.53
Edmonton, AB
886,748
4.28
2,305,928
3.18
W
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647,446
Toronto, ON
h
Halifax, NS
2
X
San Francisco, CA
4
A
6
AB
Houston, TX
X
8
NOTE: Rankings are based on the 87 U.S. and Canadian markets tracked by Colliers International
Source: Colliers International
Although still low, development activity has been increasing, albeit slowly.
Square footage under construction in the U.S. and Canadian markets
tracked by Colliers totaled 92.1 million square feet in Q1 2014, up from
88.2 million square feet in Q4 2013 and 74.4 million square feet in Q1
2013. Driven by voracious demand from energy companies, Houston continues to lead the U.S. both in terms of square footage underway (1 5.1
MSF) and square footage underway as a percentage of existing inventory
(7.2%). Most of the other top U.S. markets for construction activity are
tech-driven, such as San Francisco, San Jose, Boston and Seattle. Like
the energy industry, tech tenant demand remains robust, with large tenants pre-leasing significant amounts of space or entire buildings, prompting additional construction. Several of the largest deals in the San Francisco office market’s history were signed in buildings under construction
in recent months, including Salesforce.com’s lease for more than half of
the 1.4 million square feet of the tower anchoring the Transbay development
(now called the Salesforce Tower), and LinkedIn’s lease of the entire 26-floor,
450,000-square-foot tower under construction at 222 Second Street.
Toronto, Calgary and Vancouver are the most active development markets
in Canada, accounting for about 83% of office construction underway nationwide. In Calgary, total square footage under development accounted
for more than 10% of existing inventory as of Q1 2014, the highest share
of any U.S. or Canadian market. Like Houston, developers have responded
to robust growth among Calgary energy firms, a trend that continued in
Q1 2014 with expansions by a number of companies including Athabasca
Oil Corp., Progress Energy, TransCanada Pipelines and Total Energy Services. Higher anticipated natural gas prices and optimism regarding liquefied natural gas (LNG) projects and pipeline capacity are fueling construction activity and tenant demand.
The measured supply response, particularly in the U.S., should contribute
to a continued moderate office market recovery. Given high construction
costs and only moderate increases in tenant demand in most markets, we
expect development activity to remain low and targeted, with speculative
San Jose/Silicon Valley, CA
Seattle/Puget Sound, WA
NORTH AMERICA
3,436,907
3.06
92,063,015
1.43%
NOTE: Rankings are based on the 87 U.S. and Canadian markets tracked by Colliers International
Source: Colliers International
development focused on the strongest metro areas (e.g., San Francisco,
Boston) as well as the strongest submarkets within lagging metro areas
(e.g., West Los Angeles, Chandler, AZ).
The Rise of the Sun Belt
Looking at both economic and office market indicators, the resurgence of
the Sun Belt is evident. The region’s states and metropolitan areas possess unique characteristics, such as the robust energy sector in Texas,
strong technology clusters in Austin and North Carolina’s Research Triangle, and the expanding health care industry in Nashville. However, a
common thread running through most of the region is a low cost of doing
business that is proving attractive to expanding or relocating companies in
a range of industries.
LOWEST-COST CITIES WITH POPULATION > 2 MILLION | U.S. & CANADA
CANADA
COST INDEX
Montréal
92.0
Toronto
93.6
Vancouver
94.6
UNITED STATES
COST INDEX
Atlanta
94.7
Cincinnati
94.9
Orlando
95.1
Charlotte
95.2
San Antonio
95.6
Tampa
95.8
Cleveland
U.S. BASELINE
96.3
100.0
Source: 2014 KPMG Competitive Alternatives
P. 6
| COLLIERS INTERNATIONAL
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
LOWEST-COST CITIES WITH POPULATION 1-2 MILLION | US & CANADA
CANADA
COST INDEX
Edmonton
94.0
UNITED STATES
COST INDEX
New Orleans
94.1
Nashville
94.9
Oklahoma City
95.1
Raleigh
95.6
Memphis
95.8
Indianapolis
96.2
Salt Lake City
96.6
Austin
96.8
Buffalo
96.9
U.S. BASELINE
Office-using job growth is coming from a range of industries including
financial services, with many firms moving operations to or expanding
in lower-cost markets such as Jacksonville and Tampa. Charlotte also is
in the midst of a remarkable recovery: Its urban yet affordable lifestyle
appeals to millennial graduates of Southeastern universities, providing an
attractive talent base to companies in a variety of industries.
The strength in the Sun Belt’s job market is spreading to the office market. Despite accounting for only 30% of U.S. office inventory tracked by
Colliers, the Sun Belt markets represented nearly 60% of office absorption during Q1 2014. Houston alone accounted for more than 17% of U.S.
absorption during the quarter, with continued robust growth in the energy
TOP 20 MARKETS FOR OFFICE-USING JOBS RECOVERED SINCE
RECESSION | APRIL 2014 | US
MSA
100.0
Source: 2014 KPMG Competitive Alternatives
Examining office-using employment trends from multiple angles, Sun Belt
markets rank high. As noted in previous reports, ICEE markets Austin,
Raleigh, Houston and Dallas-Fort Worth, as well as health care center
Nashville, all rank among the top ten U.S. markets in terms of the percentage of office-using jobs recovered. In fact, all of these markets have
recovered more than twice the number of office-using jobs that they lost
during the recession. However, looking at markets with the strongest
year-over-year office-using job growth in April 2014, the list has broadened beyond the leading markets to include many previously lagging metropolitan areas. Among the top 20 markets for office-using job growth
in April are 12 Sun Belt metros, including hard-hit Florida markets Cape
Coral-Fort Myers, Jacksonville, Orlando, Tampa and West Palm Beach.
FASTEST OFFICE-USING EMPLOYMENT GROWTH | APRIL 2013-2014 | US
PERCENT
RECOVERED
Austin
472.5
Omaha
185.2
Fayetteville, AR
342.9
Grand Rapids
179.6
Raleigh
320.6
Trenton, NJ
176.2
Nashville
317.2
Indianapolis
173.9
Madison, WI
307.9
Columbus
162.8
Pittsburgh
256.6
Harrisburg
162.2
San Francisco
256.3
Baltimore
160.4
San Jose/Silicon Valley
229.2
Holland, MI
160.0
Houston
207.1
Denver
158.4
Dallas-Fort Worth
205.1
Greenville, SC
149.1
UNITED STATES: 112.7%
NOTE: Includes markets tracked by Colliers International; all data are seasonally adjusted as of April 2014.
Sources: Bureau of Labor Statistics, Federal Reserve Bank of St. Louis, Colliers International
MARKETS WITH FINANCIAL ACTIVITIES EMPLOYMENT AT OR ABOVE
PRE-RECESSION PEAK | APRIL 2014 | US
MSA
PERCENT
CHANGE
Reno
9.8
Orlando
4.5
Cape Coral-Fort Myers
8.9
San Jose/Silicon Valley
4.5
Ann Arbor
800.0
Pittsburgh
231.8
Raleigh
8.7
West Palm Beach
4.4
Midland, TX
400.0
Richmond
160.9
Savannah
7.4
Dallas-Fort Worth
4.0
St. Louis
385.2
Trenton
137.5
Nashville
7.0
Harrisburg
3.9
Lincoln, NE
375.0
Phoenix
136.6
Fresno
6.8
San Francisco
3.8
Austin
6.4
Greenville, SC
3.7
Nashville
355.6
Holland, MI
133.3
Holland, MI
6.1
Tampa-St. Petersburg
3.6
Dallas-Fort Worth
308.4
Grand Rapids, MI
122.7
Jacksonville
4.9
Portsmouth
3.4
Jacksonville
106.6
Indianapolis
4.9
Charlotte
3.4
MSA
PERCENT
CHANGE
PERCENT
RECOVERED MSA
UNITED STATES: 2.4%
NOTE: Includes markets tracked by Colliers International; all data are seasonally adjusted as of April 2014.
Sources: Bureau of Labor Statistics, Federal Reserve Bank of St. Louis, Colliers International
P. 7
| COLLIERS INTERNATIONAL
MSA
% OF
JOBS
MSA
RECOVERED
Omaha
277.8
Austin
234.5
% OF
JOBS
RECOVERED
UNITED STATES: 33.5%
NOTE: Includes markets tracked by Colliers International; all data are seasonally adjusted as of April 2014.
Sources: Bureau of Labor Statistics, Federal Reserve Bank of St. Louis, Colliers International
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
sector. Corporate relocations to the Dallas-Fort Worth region continue at
a brisk pace, highlighted this quarter by Toyota’s announcement that it
will move its long-time headquarters from Torrance, CA, to Plano. Toyota
has already leased 120,000 square feet of space in the region to house
workers during construction of its new one-million-square-foot campus.
The Toyota deal underscores the success that Texas, in particular—and
the Sun Belt generally—has had in attracting companies and its impact on
the office market. In another example of this trend, Prince Global Sports
recently announced that it will move its headquarters from New Jersey to
Atlanta’s Buckhead submarket.
The Sun Belt’s strength is unlikely to abate anytime soon, as increasingly cost-conscious firms look for low-cost locations for expansion and
relocation. ICEE hubs like Austin and Raleigh-Durham will benefit from
knowledge industry growth. The Sun Belt also will benefit from the trend
of firms dividing functions across regions, with companies moving midlevel and back-office functions to lower-cost areas. Finally, although the
Sun Belt has a more suburban profile compared with denser Northeast
and West Coast metros, many Sun Belt markets are investing in public transit and mixed-use, walkable developments, which are particularly
popular among millennials. Examples include:
• Raleigh-Durham – Research Triangle Park (RTP): RTP recently
acquired 100 additional acres of adjacent land for the development of
up to three million square feet of higher-density development in this
suburban tech park in the Raleigh-Durham metro area, the first
mixed-use space at the 55-year-old park;
• Dallas-Fort Worth – City Line: The location of State Farm’s new
two-million-square-foot regional center in Richardson, TX, this $1.5
billion mixed-use project under development by KDC also will contain
two hotels, nearly 4,000 apartments, 300,000 square feet of retail
and entertainment space, three parks, pedestrian walkways, and open
space for concerts and other public gatherings;
• Atlanta – Ponce City Market: This high-profile renovation of the
Sears, Roebuck & Company building near Midtown and adjacent to the
Atlanta BeltLine will feature 475,000 of Class A, loft office space,
330,000 square feet of retail and restaurants, and 259 residential
units in a walkable, creative environment reminiscent of denser tech
hubs such as San Francisco;
• Orlando – SunRail and Bike Share: Several development and transit
projects more typical of denser urban areas are opening in Orlando.
On the heels of the May 2014 opening of SunRail, the region’s new
commuter rail system, SunCycles will begin offering rentable bicycles
throughout Orlando, including near SunRail stations. Also, several
transit-adjacent co-working facilities are in the works.
These types of mixed-use developments are well suited to the preferences of the millennials, who represent an increasing share of the U.S.
workforce as they enter the labor force and the baby boomers retire. The
millennial cohort could exceed 50% of the workforce by 2020 and reach
75% of the workforce by 2025. As more millennials start families in the
coming years, many Sun Belt markets will be well-positioned to offer a
variety of living and working environments, including affordable singlefamily housing as well as the types of walkable, mixed-use developments
for which this cohort has demonstrated a preference.
P. 8
| COLLIERS INTERNATIONAL
Capital Markets &
Transaction Activity
The office investment market remained active through Q1 2014, particularly in CBD markets and major metro areas. Capital from both domestic
and international sources for investment in U.S. real estate remains plentiful, supporting price increases and transaction volume gains. According to Real Capital Analytics (RCA), total transaction volume in the U.S.
and Canada increased by 36% year-over-year in Q1 2014, and 12-month
trailing investment volume increased by 30%, reaching $114.9 billion, the
highest total since Q2 2008. Although investor interest is spreading beyond gateway cities and CBDs in search of higher yields, demand remains
robust in core markets. In the U.S., CBDs posted a much larger gain in
year-over-year transaction volume (60%) compared with suburban markets (10%), and investment volume increased the most in major metros,
followed by secondary and tertiary markets, respectively. Likewise, cap
rate compression was greatest in CBD markets and major metros.
OFFICE TRANSACTION VOLUME | Q1 2014 | NA
Bil .
300
200%
250
150%
200
100%
150
50%
100
0%
50
-50%
0
-100%
2007
2008
2009
2010
12-Month Trailing Volume (left-axis)
2011
2012
2013
2014
Year-Over-Year % Change (right-axis)
NOTE: Latest data as of Q1 2014; all data are 12-month trailing.
Source: Real Capital Analytics
Nonetheless, investors are responding to broader improvement in job
growth and office absorption by moving into secondary submarkets and
metropolitan areas, a trend that we expect to continue with the ongoing
recovery. Also, investors are anticipating future demand growth in submarkets proximate to core tech submarkets. For example, despite having an elevated vacancy rate, the El Segundo submarket in Los Angeles’s
South Bay has attracted much investor attention in anticipation of greater
tenant spillover demand from tech-driven, high-rent West Los Angeles,
similar to what occurred during the last business cycle. DivcoWest, Griffin Capital and Montana Avenue Capital, among others, purchased El Segundo office properties in early 2014, and many investors continue to
circle the market for acquisition and redevelopment opportunities. Given
expected increases in interest rates, coupled with broadening economic
and office market improvements, we anticipate secondary and tertiary
markets, suburban markets and spillover ICEE submarkets to benefit from
growing investor demand.
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | DOWNTOWN OFFICE | ALL INVENTORY
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
MAR 31, 2014
ABSORPTION
Q1 2014
(SF)
NORTHEAST
Baltimore, MD
28,919,710
0
45,000
12.81
-315,134
Boston, MA
62,623,701
1,050,000
1,895,940
12.02
825,333
Hartford, CT
9,971,800
0
0
12.53
112,094
New York, NY – Downtown Manhattan
110,938,458
2,861,402
2,800,000
14.43
1,246,463
New York, NY – Midtown Manhattan
230,068,701
0
0
11.78
-1,270,068
New York, NY – Midtown South Manhattan
162,245,367
894,672
3,600,000
8.83
1,468,753
Philadelphia, PA
42,994,756
0
0
11.05
189,330
Pittsburgh, PA*
32,099,033
0
800,000
10.51
-100,993
Stamford, CT
18,708,865
0
0
20.74
152,473
144,299,812
575,941
1,673,266
10.40
202,047
7,687,431
0
0
14.78
-16,011
850,557,634
5,382,015
10,814,206
11.53
2,494,287
50,122,707
0
487,034
16.21
277,375
Birmingham, AL
4,985,532
0
0
20.43
453,256
Charleston, SC
2,252,548
0
21,000
9.41
-5,279
Charlotte, NC
22,451,530
0
0
9.39
5,291
Columbia, SC
4,678,427
0
0
12.11
-50,399
33,948,045
0
450,000
26.33
112,274
Washington, DC
White Plains, NY
Northeast Total
SOUTH
Atlanta, GA
Dallas, TX
Ft. Lauderdale-Broward, FL
Ft. Worth, TX
Greenville, SC
8,130,042
0
0
12.81
60,392
10,147,172
0
75,971
15.77
136,152
3,293,679
0
85,000
17.87
-9,299
Houston, TX
42,998,330
0
1,050,000
12.39
3,959
Jacksonville, FL
15,572,544
0
0
13.24
14,964
Little Rock, AR
6,477,052
0
0
10.79
-6,365
Louisville, KY
43,267,691
299,483
0
10.94
298,773
Memphis, TN
5,954,989
0
0
18.69
32,512
Miami-Dade, FL
18,575,117
0
128,580
17.31
26,614
Nashville, TN
13,176,826
0
0
12.74
-18,282
Orlando, FL
12,174,413
0
0
12.60
-52,169
Raleigh/Durham/Chapel Hill, NC
14,368,557
388,279
242,969
6.01
262,929
Richmond, VA
16,718,420
106,662
321,500
10.52
88,034
Savannah, GA
803,516
0
0
14.06
-1,236
6,779,680
0
0
15.13
18,479
Tampa Bay, FL
West Palm Beach/Palm Beach County, FL
South Total
9,916,338
0
0
15.43
-1,644
346,793,155
794,424
2,862,054
14.38
1,646,331
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
COLLIERS INTERNATIONAL |
P. 9
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | DOWNTOWN OFFICE | ALL INVENTORY (continued)
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
MAR 31, 2014
ABSORPTION
Q1 2014
(SF)
MIDWEST
Chicago, IL
158,505,062
0
1,067,400
12.81
-174,544
Cincinnati, OH
18,989,060
0
0
15.13
-18,029
Cleveland, OH
38,028,983
0
0
16.91
-6,541
Columbus, OH
19,452,521
0
490,000
10.96
54,366
Detroit, MI**
25,827,606
0
0
18.38
86,293
5,454,500
0
0
17.43
22,655
Indianapolis, IN
22,548,402
0
0
9.49
-67,488
Kansas City, MO
34,862,105
0
0
14.16
91,465
Milwaukee, WI
19,053,201
0
73,100
12.02
148,454
Minneapolis, MN
31,700,971
0
0
13.44
-154,085
6,450,653
0
0
7.17
-21,322
St. Louis, MO
23,216,158
0
0
20.37
-526,476
St. Paul, MN
11,730,218
0
0
14.08
-76,515
415,819,440
0
1,630,500
13.93
-641,767
Albuquerque, NM
3,191,080
0
0
27.73
17,305
Bakersfield, CA
3,230,466
0
72,233
8.72
-8,212
Boise, ID
4,177,362
252,347
234,687
8.30
6,452
Grand Rapids, MI
Omaha, NE
Midwest Total
WEST
Denver, CO
34,236,601
0
963,676
11.91
101,481
Fresno, CA
3,288,944
0
0
10.83
-42,447
Honolulu, HI
7,164,686
0
0
14.36
-49,832
Las Vegas, NV
4,907,615
49,200
129,000
12.15
98,220
Los Angeles, CA
32,566,100
0
508,200
20.14
-137,400
Oakland, CA
17,255,313
363,800
0
11.49
11,114
Phoenix, AZ
20,351,253
155,000
0
21.73
95,678
Portland, OR*
35,076,079
0
343,000
9.59
-61,426
Reno, NV
3,294,386
0
0
15.14
-23,604
Sacramento, CA
13,570,765
0
0
15.49
49,426
San Diego, CA
10,172,525
0
320,000
19.36
-99,066
San Francisco, CA
88,787,552
768,412
5,381,410
9.45
345,638
8,058,857
0
0
18.16
33,217
55,560,625
36,600
3,246,507
11.10
243,554
8,221,819
0
0
15.87
25,078
San Jose/Silicon Valley, CA
Seattle/Puget Sound, WA
Stockton, CA
Walnut Creek, CA
West Total
U.S. TOTAL/AVERAGE
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
P. 10
| COLLIERS INTERNATIONAL
12,462,061
0
0
15.26
75,749
365,574,089
1,625,359
11,198,713
13.05
680,925
1,978,744,318
7,801,798
26,505,473
12.81
4,179,776
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | DOWNTOWN OFFICE | CLASS A
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL
QUOTED RENT
(USD PSF)
ABSORPTION
Q1 2014
(SF)
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT(%)
NORTHEAST
Baltimore, MD
12,805,993
22.50
209,387
Boston, MA
42,973,537
50.15
739,540
1.2
7.2
Hartford, CT
6,771,455
22.58
73,998
16.2
-0.9
New York, NY – Downtown Manhattan
4.7
-6.5
80,463,304
52.40
981,727
1.5
11.4
197,217,338
75.02
-1,128,557
5.3
12.8
New York, NY – Midtown South Manhattan
34,311,898
65.88
987,468
2.1
10.7
Philadelphia, PA
30,481,277
27.50
150,186
1.7
2.2
Pittsburgh, PA*
18,513,625
25.07
-119,853
5.3
6.6
Stamford, CT
13,339,184
38.10
65,472
-0.5
-0.5
Washington, DC
89,201,106
52.89
455,534
0.1
-2.6
White Plains, NY
4,887,012
31.62
-17,147
-1.5
0.0
530,965,729
57.54
2,397,755
3.2
8.3
30,396,533
21.66
206,701
-1.3
-5.0
4,029,421
21.06
459,144
0.5
0.0
New York, NY – Midtown Manhattan
Northeast Total
SOUTH
Atlanta, GA
Birmingham, AL
Charleston, SC
1,009,994
33.28
299
-1.5
4.0
Charlotte, NC
15,949,770
25.18
32,240
0.0
1.1
Columbia, SC
2,131,068
20.60
-51,906
-0.7
1.6
Dallas, TX
22,659,842
22.80
73,899
-1.3
5.3
Ft. Lauderdale-Broward, FL
4,494,426
33.00
33,142
3.0
4.5
Ft. Worth, TX
5,830,792
28.90
15,930
-1.0
0.3
Greenville, SC
2,021,715
20.88
6,333
2.8
5.7
30,046,293
38.80
-37,190
1.1
4.5
Jacksonville, FL
6,846,824
19.93
-214,872
0.5
1.9
Little Rock, AR
2,635,440
16.57
3,874
0.0
1.6
Louisville, KY
10,579,669
19.75
250,378
-2.0
-1.8
Memphis, TN
2,009,825
17.10
10,800
-2.6
-1.1
Miami-Dade, FL
9,758,448
39.76
42,669
-1.2
-0.8
Nashville, TN
4,058,652
23.40
258
1.8
8.4
Orlando, FL
5,776,557
25.16
-47,611
2.4
3.7
Raleigh/Durham/Chapel Hill, NC
7,008,939
24.89
17,517
3.7
3.7
Richmond, VA
6,355,704
24.83
8,638
0.6
4.7
Savannah, GA
645,713
20.91
-3,478
2.0
1.6
Tampa Bay, FL
4,999,570
23.79
12,183
2.1
4.3
West Palm Beach/Palm Beach County, FL
3,211,645
36.07
10,751
3.3
2.8
182,456,840
26.83
829,699
0.1
1.6
Houston, TX
South Total
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
COLLIERS INTERNATIONAL |
P. 11
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | DOWNTOWN OFFICE | CLASS A (continued)
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL
QUOTED RENT
(USD PSF)
ABSORPTION
Q1 2014
(SF)
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT(%)
-189,234
0.0
1.2
MIDWEST
Chicago, IL
61,063,550
37.78
Cincinnati, OH
8,359,432
22.37
35,095
0.6
2.9
Cleveland, OH
10,828,360
21.24
-15,792
2.5
-2.7
Columbus, OH
8,377,149
19.80
43,970
0.7
2.8
Detroit, MI**
8,175,021
22.74
8,333
-0.9
-0.3
Grand Rapids, MI
1,463,659
18.90
17,645
-0.6
-2.3
Indianapolis, IN
9,501,787
18.95
-52,668
0.0
0.1
Kansas City, MO
10,514,030
18.93
-8,332
0.4
0.1
5,106,083
19.71
5,931
-2.7
-3.2
Milwaukee, WI
Minneapolis, MN
13,618,828
16.73
-153,161
0.7
-0.6
Omaha, NE
3,549,103
20.25
28,055
0.0
0.6
St. Louis, MO
9,558,798
18.09
-536,227
0.4
-0.2
St. Paul, MN
2,773,960
14.45
-82,402
0.7
8.2
152,889,760
26.79
-898,787
0.4
0.8
575,047
20.14
0
1.5
1.9
Midwest Total
WEST
Albuquerque, NM
Bakersfield, CA
729,040
17.40
-11,506
0.0
0.0
1,895,059
19.22
37,890
-0.8
-1.1
Denver, CO
21,306,446
32.24
82,683
0.4
4.7
Fresno, CA
1,026,046
24.60
-22,921
0.0
2.5
Honolulu, HI
4,966,720
35.52
-64,291
-0.3
1.7
Boise, ID
Las Vegas, NV
1,103,341
31.56
4,106
-4.0
1.9
Los Angeles, CA
18,098,100
37.32
-53,000
1.3
3.0
Oakland, CA
10,562,045
33.96
-41,698
3.7
10.5
Phoenix, AZ
9,473,518
22.90
52,232
-0.2
0.7
13,101,110
25.92
-75,177
1.7
-0.8
Portland, OR*
Reno, NV
Sacramento, CA
San Diego, CA
San Francisco, CA
San Jose/Silicon Valley, CA
Seattle/Puget Sound, WA
Stockton, CA
Walnut Creek, CA
West Total
U.S. TOTAL/AVERAGE
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
P. 12
| COLLIERS INTERNATIONAL
583,955
23.60
-3,272
-1.9
-1.0
5,945,146
31.32
18,734
-1.1
-2.6
7,257,266
29.04
-107,547
2.1
2.5
57,113,693
55.33
282,796
5.7
15.9
3,493,453
33.96
1,800
2.2
6.8
32,199,750
33.79
202,236
3.3
7.1
2,790,574
20.04
18,572
1.2
1.2
7,271,861
27.84
41,552
0.4
1.8
199,492,170
38.15
363,189
3.3
8.8
1,065,804,499
44.24
2,691,856
2.6
7.1
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | SUBURBAN OFFICE | ALL INVENTORY
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
ABSORPTION
Q1 2014
(SF)
NORTHEAST
Baltimore, MD
88,313,969
733,400
0
12.78
12.24
1,117,891
112,558,294
0
1,621,398
18.54
18.06
465,723
Fairfield County, CT
41,029,234
0
0
13.83
13.88
-21,780
Hartford, CT
12,784,662
0
0
15.14
13.04
268,458
Boston, MA
Long Island, NY*
74,441,967
17,500
83,799
10.37
10.18
59,574
New Jersey – Central
131,315,428
20,525
0
16.12
15.66
630,497
New Jersey – Northern
163,629,090
40,018
0
15.52
15.73
-227,866
Philadelphia, PA
110,589,759
409,768
444,838
15.07
15.25
154,339
Pittsburgh, PA*
89,949,523
72,758
1,358,555
7.47
7.23
313,974
Washington, DC
288,069,589
40,000
4,417,114
16.50
16.85
-992,938
37,475,453
0
382,000
13.07
13.30
441,600
1,150,156,968
1,333,969
8,307,704
14.77
14.72
2,209,472
171,846,820
0
1,138,554
16.64
16.03
973,919
Westchester County, NY
Northeast Total
SOUTH
Atlanta, GA
Birmingham, AL
14,683,132
0
0
14.15
15.02
-128,147
Charleston, SC
9,818,033
114,880
215,000
11.58
11.51
91,032
Charlotte, NC
62,212,257
135,735
284,876
12.41
12.30
166,905
Columbia, SC
4,966,961
0
0
23.69
22.62
52,966
240,233,017
321,680
4,699,879
14.91
14.55
1,150,240
Ft. Lauderdale-Broward, FL
42,915,729
0
320,000
14.29
14.50
-89,802
Ft. Worth, TX
20,935,696
0
760,935
10.56
10.47
20,007
Dallas, TX
Greenville, SC
Houston, TX
Jacksonville, FL
Little Rock, AR
4,896,690
0
0
18.87
19.60
-35,824
167,004,638
2,203,414
14,002,344
12.14
11.94
2,270,623
46,157,943
12,151
219,488
12.43
11.75
315,140
7,521,709
0
0
13.33
12.59
29,076
Memphis, TN
27,125,867
0
241,000
15.03
14.65
123,510
Miami-Dade, FL
65,856,673
0
173,537
11.37
11.18
196,117
Nashville, TN
14,982,680
239,000
731,000
4.65
6.00
25,340
Orlando, FL
54,412,681
86,581
185,428
13.54
13.65
16,518
Raleigh/Durham/Chapel Hill, NC
64,739,388
58,072
1,248,552
13.04
13.00
-8,699
Richmond, VA
34,701,543
15,000
43,000
10.02
10.35
-100,598
Savannah, GA
1,461,838
0
0
19.29
19.88
-8,571
Tampa Bay, FL
57,275,381
0
18,000
17.91
17.66
142,244
West Palm Beach/Palm Beach County, FL
28,494,121
30,000
133,586
18.11
17.66
168,999
1,142,242,797
3,216,513
24,415,179
14.02
13.78
5,370,995
South Total
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
COLLIERS INTERNATIONAL |
P. 13
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | SUBURBAN OFFICE | ALL INVENTORY (continued)
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
ABSORPTION
Q1 2014
(SF)
MIDWEST
Chicago, IL
155,400,746
0
0
16.56
17.00
-674,174
Cincinnati, OH
46,444,317
0
1,000,000
16.13
15.80
153,274
Cleveland, OH
42,798,934
0
217,474
11.14
11.25
-49,060
Columbus, OH
44,027,261
0
396,840
10.57
10.46
47,848
137,895,919
27,666
66,820
18.66
18.22
-877,682
Grand Rapids, MI
12,439,041
0
104,528
21.60
18.77
964
Indianapolis, IN
43,264,183
0
132,991
9.62
9.70
-34,048
Kansas City, MO
58,155,167
0
769,000
11.79
11.50
167,522
Milwaukee, WI
33,235,130
0
160,000
12.73
12.43
98,165
Minneapolis, MN
79,185,563
598,400
870,900
13.85
13.49
802,423
Omaha, NE
21,146,090
112,000
166,189
11.22
10.42
236,488
St. Louis, MO
55,394,777
183,000
435,000
9.04
9.56
-88,297
729,387,128
921,066
4,319,742
14.35
14.23
-216,577
10,877,999
0
0
16.27
15.69
63,242
Detroit, MI**
Midwest Total
WEST
Albuquerque, NM
Bakersfield, CA
Boise, ID
Denver, CO
6,070,404
8,984
77,984
7.11
6.53
43,325
17,154,856
0
137,561
10.19
12.42
-247,813
106,095,670
621,035
709,757
13.05
13.04
304,644
Fairfield, CA
5,008,186
0
30,000
20.40
20.91
-25,659
Fresno, CA
17,562,156
20,000
0
14.08
13.10
189,879
Honolulu, HI
Las Vegas, NV
Los Angeles, CA
7,730,394
0
0
10.90
11.85
-14,701
36,591,706
47,000
468,000
22.58
22.41
96,786
167,879,800
152,300
1,588,000
17.82
17.64
364,700
Los Angeles – Inland Empire, CA
20,588,091
94,891
58,000
19.14
18.90
112,500
Oakland, CA
16,271,372
106,221
0
19.72
19.99
-64,320
Orange County, CA
81,034,800
0
860,000
14.99
15.67
-584,100
111,009,754
117,710
0
18.84
18.31
677,939
Pleasanton/Tri-Valley, CA
27,748,942
0
0
11.84
12.81
-299,353
Portland, OR*
43,336,020
0
50,644
9.95
9.97
-8,127
9,625,581
0
0
14.00
14.20
-18,625
Phoenix, AZ
Reno, NV
Sacramento, CA
52,144,531
68,417
77,000
19.13
18.91
141,121
San Diego, CA
72,053,974
541,135
464,917
13.13
12.81
698,502
San Francisco Peninsula
35,178,978
67,098
216,000
11.37
11.28
-14,561
San Jose/Silicon Valley, CA
64,342,407
465,283
2,305,928
11.40
9.89
261,433
Seattle/Puget Sound, WA
56,697,125
0
190,400
10.09
10.31
-80,643
Walnut Creek, CA
West Total
U.S. TOTAL/AVERAGE
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
P. 14
| COLLIERS INTERNATIONAL
5,513,617
0
0
17.03
16.27
41,687
970,516,363
2,310,074
7,234,191
15.17
15.01
1,637,856
3,992,303,256
7,781,622
44,276,816
14.57
14.43
9,001,746
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | SUBURBAN OFFICE | CLASS A
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL
QUOTED RENT
(USD PSF)
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT (%)
ABSORPTION
Q1 2014
(SF)
NORTHEAST
Baltimore, MD
32,057,456
24.00
14.31
13.25
-3.5
-4.0
877,044
Boston, MA
48,167,313
25.95
16.61
16.52
1.8
2.7
93,065
Fairfield County, CT
17,951,999
39.02
12.90
11.74
0.1
4.8
-74,311
Hartford, CT
7,123,495
21.37
14.95
12.82
0.0
4.7
151,908
Long Island, NY*
25,283,739
30.38
10.43
9.98
0.3
-0.3
-8,666
New Jersey – Central
61,295,100
25.73
16.39
15.42
0.6
-2.7
594,718
New Jersey – Northern
87,786,735
27.94
17.49
18.04
3.7
5.5
-448,224
Philadelphia, PA
67,413,158
25.43
13.59
13.55
1.0
2.6
382,819
Pittsburgh, PA*
16,646,383
21.85
6.16
5.59
-1.6
-0.5
126,967
Washington, DC
137,649,927
32.50
16.49
17.16
0.0
-1.2
-880,154
Westchester County, NY
Northeast Total
17,570,629
27.38
15.75
15.60
1.7
2.9
529,976
518,945,934
28.33
15.37
15.31
0.8
0.9
1,345,142
81,389,815
22.68
14.57
14.09
0.7
2.3
397,015
9,276,993
20.69
10.67
11.88
0.0
-0.7
-112,014
SOUTH
Atlanta, GA
Birmingham, AL
Charleston, SC
3,689,350
24.41
6.36
6.04
2.3
-0.2
54,717
Charlotte, NC
20,105,237
23.16
13.81
13.89
0.9
1.6
-16,697
Columbia, SC
1,001,769
17.12
17.46
18.42
0.2
4.1
-9,607
Dallas, TX
96,558,826
24.70
13.77
13.30
2.9
6.5
622,193
Ft. Lauderdale-Broward, FL
10,570,258
27.18
16.57
14.79
0.1
-0.7
188,660
Ft. Worth, TX
3,462,446
24.95
1.75
1.55
0.2
1.8
7,040
Greenville, SC
2,458,553
19.09
13.54
14.46
4.7
7.2
-22,758
73,524,938
31.83
9.10
8.48
4.9
7.8
2,148,853
Jacksonville, FL
9,183,187
19.46
9.90
9.31
-2.7
-1.6
53,959
Little Rock, AR
2,842,952
18.45
18.26
17.26
1.2
-4.1
19,425
Houston, TX
Memphis, TN
8,135,106
21.02
8.19
8.01
-0.8
0.2
15,041
16,163,894
32.51
15.53
15.20
0.8
1.9
53,384
Nashville, TN
7,539,146
25.00
3.26
6.75
1.8
4.6
-21,207
Orlando, FL
16,829,913
21.17
16.71
17.05
-0.1
1.5
-56,721
Raleigh/Durham/Chapel Hill, NC
25,186,477
21.31
11.64
11.64
1.0
4.4
666
Richmond, VA
13,775,329
17.91
8.69
9.55
-0.8
-0.7
-118,929
Savannah, GA
490,035
23.33
15.89
15.96
6.2
3.2
-320
18,368,902
23.50
17.22
17.19
0.3
1.9
4,193
Miami-Dade, FL
Tampa Bay, FL
West Palm Beach/Palm Beach County, FL
South Total
9,008,923
31.39
17.79
18.32
2.5
4.3
-47,311
429,562,049
25.00
12.78
12.52
2.1
4.4
3,159,582
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
COLLIERS INTERNATIONAL |
P. 15
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | SUBURBAN OFFICE | CLASS A (continued)
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL
QUOTED RENT
(USD PSF)
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT (%)
ABSORPTION
Q1 2014
(SF)
MIDWEST
Chicago, IL
77,370,162
27.32
17.33
18.44
-0.4
0.2
-854,605
Cincinnati, OH
18,130,644
19.61
17.96
17.79
2.5
-2.0
30,960
Cleveland, OH
9,063,399
21.34
12.29
11.75
0.6
-0.1
48,422
Columbus, OH
18,337,079
19.31
9.33
9.00
-0.4
0.7
60,883
Detroit, MI**
34,571,052
20.16
16.43
15.30
4.2
-1.8
850,872
796,522
17.50
26.07
17.14
0.0
0.0
8,139
Indianapolis, IN
12,456,333
18.45
12.64
12.52
0.5
1.1
15,123
Kansas City, MO
16,231,344
20.54
10.80
11.09
-0.5
0.7
-47,088
6,116,590
19.45
12.65
11.05
-4.4
-5.4
97,491
26,701,091
14.23
16.95
15.92
2.2
3.1
780,200
5,056,660
25.49
3.74
2.87
2.8
-2.9
131,081
26,374,431
21.85
8.81
9.15
-0.7
-1.6
72,637
251,205,307
21.87
14.52
14.52
0.4
-0.4
1,194,115
Grand Rapids, MI
Milwaukee, WI
Minneapolis, MN
Omaha, NE
St. Louis, MO
Midwest Total
WEST
Albuquerque, NM
811,008
22.10
6.40
4.31
5.5
6.0
16,981
Bakersfield, CA
2,776,404
24.00
5.84
5.84
0.0
0.0
-191
Boise, ID
5,826,036
15.51
14.71
15.38
0.9
8.5
-39,131
Denver, CO
34,959,680
25.12
11.24
12.17
1.9
4.4
-22,087
Fairfield, CA
1,927,371
26.26
20.65
21.10
1.9
1.8
-8,681
Fresno, CA
3,973,324
25.80
18.51
16.99
0.0
2.4
14,450
Las Vegas, NV
4,849,993
29.76
33.46
33.45
0.4
0.8
328
102,218,200
35.04
16.72
16.37
0.0
2.8
365,600
Los Angeles – Inland Empire, CA
4,999,200
25.44
21.07
21.01
2.4
5.5
63,200
Oakland, CA
3,682,927
29.64
22.39
23.83
7.4
8.3
-11,269
Orange County, CA
32,704,300
26.40
15.20
16.21
1.4
2.8
-330,100
Phoenix, AZ
30,714,482
24.05
18.47
17.56
1.2
3.1
278,628
Pleasanton/Tri-Valley, CA
15,526,039
28.92
9.81
10.07
3.0
10.0
-70,476
Portland, OR*
11,003,028
23.50
11.58
11.62
-0.3
0.3
-4,046
912,364
20.79
15.93
14.93
0.8
9.0
9,129
Sacramento, CA
14,682,299
22.32
17.78
17.39
0.5
1.1
56,858
San Diego, CA
24,414,511
35.28
12.16
12.38
3.2
4.6
422,616
San Francisco Peninsula
22,523,111
43.68
11.07
10.33
1.1
3.1
141,107
San Jose/Silicon Valley, CA
33,287,282
42.72
13.74
12.45
-1.7
9.2
284,624
Seattle/Puget Sound, WA
20,754,950
33.14
9.27
9.42
0.9
-0.5
-42,629
Los Angeles, CA
Reno, NV
Walnut Creek, CA
West Total
U.S. TOTAL/AVERAGE
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
P. 16
| COLLIERS INTERNATIONAL
737,964
28.68
18.18
19.13
0.0
4.7
-6,979
373,284,473
31.61
14.77
14.61
1.1
4.2
1,117,932
1,572,997,763
27.17
14.38
14.26
1.2
2.5
6,816,771
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
CANADA | DOWNTOWN OFFICE | ALL INVENTORY
MARKET
EXISTING
INVENTORY (SF)
MAR 31, 2014
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
MAR 31, 2014
8.13
429,195
Calgary, AB
40,447,480
841,064
4,200,000
Edmonton, AB
ABSORPTION
Q1 2014
(SF)
11,332,244
0
629,348
8.91
13,035
Halifax, NS*
4,679,727
0
475,900
11.46
0
Montréal, QC
49,331,103
0
870,892
5.14
93,499
Ottawa, ON**
15,995,156
0
0
8.78
370,338
3,739,664
0
160,000
10.95
0
Regina, SK
Saskatoon, SK
2,402,872
13,000
0
6.22
-3,566
Toronto, ON
70,532,020
0
5,190,400
3.78
227,482
Vancouver, BC
24,474,251
45,770
2,150,490
5.56
-50,863
Victoria, BC*
4,902,931
0
29,000
8.69
0
Waterloo Region, ON
3,912,918
0
0
12.93
-23,312
11,365,771
0
130,375
8.43
0
243,116,137
899,834
13,836,405
6.28
1,055,808
ABSORPTION
Q1 2014
(SF)
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT (%)
Winnipeg, MB*
CANADA TOTAL
CANADA | DOWNTOWN OFFICE | CLASS A
MARKET
Calgary, AB
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL
QUOTED RENT
(CAD PSF)
27,568,453
58.00
486,154
0.0
-2.6
6,690,855
22.00
27,965
-4.3
-47.2
Halifax, NS*
1,934,103
32.58
0
0.0
0.2
Montréal, QC
22,794,332
45.00
-5,008
0.0
0.0
Ottawa, ON**
10,004,044
45.54
271,708
-1.2
-7.3
1,392,816
44.00
0
0.0
4.8
570,571
43.00
0
0.0
7.5
Toronto, ON
41,006,585
56.17
126,878
-1.1
7.2
Vancouver, BC
10,094,997
52.53
-15,406
0.0
-4.5
513,808
34.00
0
0.0
-2.9
Waterloo Region, ON
1,561,288
24.10
1,906
-4.9
-7.4
Winnipeg, MB*
2,619,428
33.75
0
0.0
0.7
126,751,280
50.13
894,197
-0.5
-0.7
Edmonton, AB
Regina, SK
Saskatoon, SK
Victoria, BC*
CANADA TOTAL
*Halifax, Victoria and Winnipeg report semi-annually. Q4 data displayed.
**Ottawa data is from Q1 2013.
COLLIERS INTERNATIONAL |
P. 17
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
CANADA | SUBURBAN OFFICE | ALL INVENTORY
EXISTING
INVENTORY (SF)
MAR 31, 2014
MARKET
Calgary, AB
NEW SUPPLY
Q1 2014
(SF)
UNDER
CONSTRUCTION
(SF)
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
ABSORPTION
Q1 2014
(SF)
25,818,920
534,606
2,478,741
9.49
9.62
153,225
Edmonton, AB
9,365,692
100,000
257,400
11.08
12.37
4,152
Halifax, NS*
6,522,447
0
171,546
10.68
10.68
0
Montréal, QC
25,078,227
70,908
484,970
10.99
11.38
-34,017
Ottawa, ON**
21,083,170
0
0
10.45
10.39
14,575
Regina, SK
675,313
0
40,000
3.26
3.26
0
Toronto, ON
70,367,959
353,768
1,608,662
8.15
8.05
-7,806
Vancouver, BC
29,429,814
60,000
1,990,462
10.38
11.27
-140,171
Victoria, BC*
3,717,151
0
99,600
9.87
9.87
0
Waterloo Region, ON
7,499,773
0
242,940
12.48
21.55
-702,924
Winnipeg, MB*
3,386,471
0
70,000
8.54
8.54
0
202,944,937
1,119,282
7,444,321
9.64
10.18
-712,966
CANADA TOTAL
CANADA | SUBURBAN OFFICE | CLASS A
EXISTING
INVENTORY (SF)
MAR 31, 2014
ANNUAL QUOTED
RENT
(CAD PSF)
Calgary, AB
12,727,120
43.00
9.49
8.44
-2.3
-2.3
201,410
Halifax, NS*
2,852,545
28.50
8.70
8.70
0.0
0.5
0
Montréal, QC
13,904,646
29.00
9.56
10.02
3.6
7.4
-880
Ottawa, ON**
12,037,326
29.39
10.46
10.45
-0.4
-3.9
2,255
Toronto, ON
32,225,597
31.17
9.37
9.07
1.8
1.3
52,147
Vancouver, BC
14,776,892
33.43
11.30
12.06
2.3
-1.7
-59,165
808,145
40.00
16.53
16.53
0.0
5.3
0
3,735,759
22.41
12.87
15.18
0.9
-7.4
-86,371
93,068,030
32.24
10.05
10.08
1.0
0.1
109,396
MARKET
Victoria, BC*
Waterloo Region, ON
CANADA TOTAL
VACANCY
RATE (%)
DEC 31, 2013
VACANCY
RATE (%)
MAR 31, 2014
QUARTERLY
CHANGE IN
RENT (%)
ANNUAL
CHANGE IN
RENT (%)
ABSORPTION
Q1 2014
(SF)
*Halifax, Victoria and Winnipeg report semi-annually. Q4 data displayed. | **Ottawa data is from Q1 2013.
CBD OFFICE UNDER CONSTRUCTION BY MARKET | Q1 2014 | CANADA
CBD OFFICE ABSORPTION BY MARKET | Q1 2014 | CANADA
Calgary, AB
429.2
Toronto, ON
227.5
Montréal, QC
0.0
Victoria, BC*
0.0
Regina, SK
0.0
Halifax, NS*
0.0
Saskatoon, SK
Waterloo Region, ON
0.5
0.2
Regina, SK
Vancouver, BC -50.9
P. 18
0.6
Halifax, NS*
-23.3
0.0
0.9
Montréal, QC
Edmonton, AB
-3.6
-100.0
2.2
Vancouver, BC
13.0
Winnipeg, MB*
4.2
Calgary, AB
93.5
Edmonton, AB
5.2
Toronto, ON
100.0
200.0
300.0
400.0
500.0
Winnipeg, MB
0.1
Victoria, BC*
0.0
Waterloo Region, ON
0.0
Saskatoon, SK
0.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
SF (Thousands)
SF (Millions)
*Victoria, Halifax and Winnipeg report data semi-annually (Q2 and Q4). | Source: Colliers International
*Victoria, Halifax and Winnipeg report data semi-annually (Q2 and Q4). | Source: Colliers International
| COLLIERS INTERNATIONAL
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
UNITED STATES | OFFICE INVESTMENT
CBD
SALES PRICE
(USD PSF)
CBD
CAP RATE
(%)
SUBURBAN
SALES PRICE
(USD PSF)
SUBURBAN
CAP RATE
(%)
Albuquerque, NM
145.00
9.00
175.00
8.00
Atlanta, GA
125.00
7.90
165.00
7.80
Baltimore, MD
164.99
6.50
135.83
Boston, MA
319.00
6.60
235.00
Charleston, SC
400.00
6.50
240.00
7.50
Chicago, IL
375.00
6.25
225.00
7.50
Cincinnati, OH
125.00
9.75
135.00
9.25
110.00
7.00
133.36
6.82
MARKET
Bakersfield, CA
205.00
Dallas, TX
62.00
Denver, CO
512.46
Detroit, MI**
27.00
5.90
Fairfield County, CT
Fresno, CA
125.00
Ft. Lauderdale-Broward, FL
246.00
8.50
10.45
41.00
11.60
139.00
9.00
160.00
8.00
154.00
Ft. Worth, TX
125.00
8.00
Houston, TX
335.00
5.30
214.00
7.30
Indianapolis, IN
165.00
8.50
150.00
7.25
Jacksonville, FL
112.00
9.00
125.00
9.76
Las Vegas, NV
Little Rock, AR
127.94
88.00
9.00
117.00
9.00
Long Island, NY*
176.00
8.00
Los Angeles, CA
276.00
6.44
200.00
7.50
Los Angeles – Inland Empire, CA
Miami-Dade, FL
269.00
287.00
Milwaukee, WI
120.00
8.75
110.00
9.00
Minneapolis, MN
149.00
7.50
110.00
6.90
Nashville, TN
250.00
7.10
150.00
7.00
New Jersey – Central
190.02
7.90
New Jersey – Northern
113.18
7.90
175.00
8.00
217.00
6.14
New York, NY - Downtown Manhattan
315.00
4.75
New York, NY – Midtown Manhattan
861.00
5.50
New York, NY – Midtown South Manhattan
693.00
4.50
Oakland, CA
270.00
7.00
Orange County, CA
Orlando, FL
175.00
7.50
136.00
6.00
Philadelphia, PA
162.00
7.80
171.89
7.56
Phoenix, AZ
84.00
7.50
112.00
7.00
Pittsburgh, PA*
85.00
9.00
113.00
8.40
175.62
6.00
Pleasanton/Tri-Valley, CA
Portland, OR*
166.86
6.00
Sacramento, CA
85.24
6.50
70.00
8.20
Pittsburgh, PA
85.00
9.00
113.00
8.40
166.86
6.00
-
-
88.56
7.50
113.47
6.74
Portland, OR
Sacramento, CA
*Long Island, Pittsburgh and Portland data is from Q4 2013.
**Detroit data is from Q3 2013.
COLLIERS INTERNATIONAL |
P. 19
HIGHLIGHTS | Q1 2014 | OFFICE | NORTH AMERICA
485 offices in
63 countries on
6 continents
United States: 146
Canada: 44
Latin America: 25
Asia Pacific: 186
EMEA: 84
•$2.1
billion in annual revenue
•15,800
professionals and staff
UNITED STATES | OFFICE INVESTMENT (continued)
CBD SALES
PRICE
(USD PSF)
CBD
CAP RATE
(%)
SUBURBAN
SALES PRICE
(USD PSF)
SUBURBAN
CAP RATE
(%)
San Diego, CA
170.19
5.90
171.04
6.50
San Francisco, CA
560.00
4.80
275.00
7.20
MARKET
San Francisco Peninsula
San Jose/Silicon Valley
6.00
Savannah, GA
160.00
9.25
120.00
9.50
Seattle/Puget Sound, WA
389.61
6.38
251.01
7.88
St. Louis, MO
90.00
9.50
135.00
8.50
Stamford, CT
186.00
8.00
•1.46
billion square feet under management
Tampa Bay, FL
110.58
7.50
98.41
8.00
•$75
billion in total transaction value
Walnut Creek, CA
269.00
5.50
180.00
8.00
Washington, DC
600.00
5.44
300.00
6.23
83.00
8.00
Westchester County, NY
West Palm Beach/Palm Beach County, FL
COLLIERS INTERNATIONAL
601 Union Street, Suite 4800
Seattle, WA 98101
TEL +1 206 695 4200
FOR MORE INFORMATION
Andrea B. Cross
Office Research Manager | USA
TEL +1 415 288 7892
EMAIL [email protected]
CONTRIBUTORS
150.00
187.00
White Plains, NY
93.00
8.00
U.S. AVERAGE*
238.78
7.18
163.73
7.81
CBD SALES
PRICE
(CAD PSF)
CBD
CAP RATE
(%)
SUBURBAN
SALES PRICE
(CAD PSF)
SUBURBAN
CAP RATE
(%)
Edmonton, AB
275.23
5.75
Montréal, QC
265.00
6.75
185.00
7.25
200.00
7.25
*Straight averages used.
CANADA | OFFICE INVESTMENT
MARKET
Regina, SK
280.00
6.75
KC Conway
Chief Economist | USA
Saskatoon, SK
306.00
6.75
Jeff Simonson
Senior Research Analyst | USA
Vancouver, BC
500.00
5.00
375.00
6.25
Victoria, BC*
325.00
6.20
280.00
6.25
Jennifer Macatiag
Graphic Designer | USA
Waterloo Region, ON
111.00
9.18
141.00
7.50
Winnipeg, MB*
150.00
7.25
140.00
7.25
Aaron Finkelstein
Communications Manager | USA
CANADA AVERAGE**
276.53
6.70
220.17
6.96
Cliff Plank
National Director | GIS & Mapping
Copyright © 2014 Colliers International.
The information contained herein has been obtained from
sources deemed reliable. While every reasonable effort
has been made to ensure its accuracy, we cannot
guarantee it. No responsibility is assumed for any
inaccuracies. Readers are encouraged to consult their
professional advisors prior to acting on any of the
material contained in this report.
*Victoria and Winnipeg report semi-annually. Q4 data displayed. **Straight averages used.
Glossary
Inventory — Includes all existing multi- or single-tenant
leased and owner-occupied office properties greater than or
equal to 10,000 square feet (net rentable area). In some
larger markets this minimum size threshold may vary up to
50,000 square feet. Does not include medical or government
buildings.
Vacancy Rate — Percentage of total inventory physically
vacant as of the survey date, including direct vacant and
sublease space.
Absorption — Net change in physically occupied space over a
given period of time.
Accelerating success.
P. 20
| COLLIERS INTERNATIONAL
New Supply — Includes completed speculative and
build-to-suit construction. New supply quoted on a net basis
after any demolitions or conversions.
Annual Quoted Rent — Includes all costs associated with
occupying a full floor in the mid-rise portion of a Class A
building, inclusive of taxes, insurance, maintenance, janitorial
and utilities (electricity surcharges added where applicable).
All office rents in this report are quoted on an annual, gross
per square foot basis. Rent calculations do not include
sublease space.
Cap Rate — (Or going-in cap rate) Capitalization rates in this
survey are based on multi-tenant institutional grade buildings
fully leased at market rents. Cap rates are calculated by
dividing net operating income (NOI) by purchase price.
NOTE: SF = square feet
MSF = million square feet
PSF = per square foot
CBD = central business district