Office Tenants Want New Construction: Cushman & Wakefield

Originally published on February 16, 2022, by Michael Boonshoft for Cushman & Wakefield.

Cushman & Wakefield, a leading global real estate services firm, today released a construction report, surveying 24 select office projects currently under construction in 12 major U.S. markets and Toronto. The report finds that new construction is commanding a significant rent premium of 64% over average Class A submarket rents, and 20% over existing top-tier trophy assets. 

“Tenants are demonstrating a strong bias for the highest quality, newly constructed office projects across major US and Canadian markets – they are looking for a fundamentally different, elevated, office experience,” said Rebecca Rockey, Cushman & Wakefield’s Global Head of Economic Analysis & Forecasting.

Cushman & Wakefield is forecasting for 48.5 million square feet (msf) to deliver in 2022 and 25.6 msf to deliver in 2023. Delays are factored into these forecasts. Key delivery dates continue to get pushed back as materials are delayed and wait times creep up due to pandemic-driven supply chain issues.  

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