Rightsizing and flight to quality driving leasing activity

Contributors:

In every major industry except for technology, most of the largest office tenants have downsized their office footprints since the end of 2019.
Reductions have generally been moderate and notable outliers have invested significantly in office space over the last three years.
The propensity of large office users to relocate into higher-quality product over the last several years has led to higher average rental rates across their portfolios. So despite a net reduction in leased space, higher per-square-foot pricing has muted the impact on tenants’ total cost of occupancy.

Public-private office pricing disconnect is intensifying