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Special Report

Office Research Brief

July 2022

Leasing Edge Emerging for Assets with
Recent Health-Related Renovations

Bifurcated fundamentals surface within the office market. Despite the strong performance of freshly renovated offices in urban cores, vacancy in the nation’s CBDs is climbing at a quicker rate than suburban office vacancy, based on preliminary second quarter data. This is in part due to the increased emphasis on facilities with health-conscious attributes, like air quality and moisture, water quality, and access to natural lighting. Tenants are choosing between paying premiums for spaces with health-promoting qualities, or reducing expenses by moving into more cost-effective locales. The result is stabilizing performance for space with post-pandemic upgrades, while older assets without modern features have struggled, especially in urban cores.

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