The greater Boston office market is experiencing a decline as we approach mid-2023, with muted leasing velocity and significant difficulties facing investment sales, according to an office market report from Hunneman Research Department. Overall market absorption has posted negative figures of approximately 1,151,894 square feet resulting in a 15.5% vacancy rate. Suburban office inventory initially resisted downward pressure; however it is now following the urban trend with vacancies increasing and effective rents dropping significantly in some cases.
Recent data from the Federal Reserve points to tighter loan standards and weaker demand for commercial real estate loans which could impact construction investments and development within the industry. Signs of distress are growing with defaults on debt along with declines in commercial property prices; yet there remains optimism due to Boston’s resilience compared to other major metropolitan areas across America .
This post provides insight into current trends affecting The Greater Boston Office Market as we approach mid-2023
