Dec 13, 2021 - Real Estate

Demand for office space in Philly lags other large metros

Illustration of a fading silhouette of a suited person on an office chair
Illustration: Annelise Capossela/Axios

Philadelphia's office space industry is recovering from pandemic-driven shutdowns and shifts in work more slowly than other large metros, according to a new CBRE report.

Why it matters: Many employees are still working from home, and it's one of the main drivers behind empty downtowns in the Philly metro and across the country.

State of play: Demand for office space in Philly lags behind almost all of the top 12 U.S. office markets, compared to pre-pandemic levels.

  • Only San Francisco saw slower recovery, according to the commercial real estate firm.
  • Philadelphia's leasing activity modestly improved in October but still fell below 75% of its pre-pandemic baseline.

Between the lines: The city also has seen a slight decrease in sublease availability, a positive sign.

  • But Philadelphia is still struggling "to reduce the record-high level of sublease space seen in September," the report states.

Of note: The report, published in October, bases its ranking on space requirements of active tenants in the market, leasing activity and sublease availability.

What they're saying: "Barring another COVID resurgence, the office market appears on increasingly firmer footing heading into 2022," the CBRE report says.

avatar

Get more local stories in your inbox with Axios Philadelphia.

🌱

Support local journalism by becoming a member.

Learn more

More Philadelphia stories

No stories could be found

Philadelphiapostcard

Get a free daily digest of the most important news in your backyard with Axios Philadelphia.

🌱

Support local journalism by becoming a member.

Learn more