“The market informs us that CPI is up 9.1% year-over-year, interest rates were raised .75 basis points by the Fed, with two more expected escalations by the end of the third quarter, and S&P and our portfolios are down more than 20%. What is a tenant rep to make of this, and how can we deal with Building Operating Expenses, as well as rent escalators throughout the lease term, while in discussions with the tenant? Asset Management has been reporting a $5-7 per sq. ft. average pass thru after base year for suburban Class A buildings. What will the new number be with OPEX escalations in line items such as RE taxes and insurance and utilities and repairs, just to mention a few? As representatives of both LL and tenant, we need to stay informed and be prepared to advise our clients. Fortunately, we have super asset managers to help us.” Kevin Curran, First Vice President
- Rents remained relatively flat during Q2 2022, ending the quarter at $21.02. This is a decrease of $0.08 quarter-over-quarter, but an increase of $0.25 year-over-year, highlighting the stabilization of rents since the initial negative effects of the pandemic.
- Available sublet space remains prevalent, with 343,000 square feet of sublet space available in the market to end Q2 2022. This is more than three times the amount of available sublet space that the market saw in Q2 2020.
- The market saw over 390,000 square feet of leasing activity during Q2 2022.