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Limited options persist in the CBD, asking rents rise in response
Gross asking rents in the Central Business District (CBD) continued to climb in the second quarter, now averaging $61.26 per square foot (psf) – a 6.4% increase year over year. Availability in the CBD remains low, now at 3.4% compared to 5.7% one year prior, and tenants seeking near-term space face limited options and competition with other tenants in the market. Market expectations are unchanged relative to the previous quarter as rising rents and tightening availability are likely to persist until supply pressures are alleviated. Options will open further into the future with several new and redeveloped buildings planning to deliver in the next 12-36 months. With limited quality alternatives in the CBD, tenant advocacy will play an important role in navigating the tight market.