DTZ FHO Partners Releases Year End 2007 Market Statistics
As we head into 2008, the positive momentum that has carried the Greater Boston commercial real estate market to this point in the recovery is expected to continue
Boston, December 21, 2007: DTZ FHO Partners, a leader in the commercial real estate advisory services field, has released its Year End 2007 Market Statistics. These statistics are complied by our Research Department and provide a comprehensive market-by-market analysis of Greater Boston’s commercial real estate market on the office, laboratory and R&D markets, how they have performed year-to-date and what you can expect in 2008.
Greater Boston’s commercial real estate market continues to recover at a measured pace; declining vacancy, new construction, and increasing rental rates all indicate the overall stability of the market. Below are some notable facts about the Boston, Cambridge and Suburban markets.
Boston
- Downtown Boston continues to see the availability rate decrease, even with less than average levels of net absorption. A total of 475,700 SF of absorption was observed in 2007, nearly 35% less than in 2006 (there was 723,378 square feet of net absorption at YE 2006).
- Since the beginning of 2007, availability has declined from 13.3% to the current rate of 12.3%. The amount of vacant space available for immediate lease is 6.3%.
- Asking rents continued to climb throughout 2007 with direct weighted average asking rents in Boston at $55.01 YE 2007, up nearly $20 since the end of 2006.
Cambridge
- The office market in Cambridge was sluggish with activity in the second half of 2007, and that is reflected in the relatively paltry total of 69,208 SF of net absorption for the year.
- Average rents in the Cambridge office market increased significantly to $40.24/sf, up from $31.69/sf at the end of 2006.
- The lab market in Cambridge fared better with 224,136 of net absorption in 2007 and average asking rents that increased from $44.20/sf at the end of 2006 to $56.97/sf at the end of 2007.
Suburbs
- There was more net absorption in the Suburban Office/R&D markets this year than last; net absorption in 2006 was 2.31 MSF and 2.6 MSF in 2007.
- The overall amount of available space in the suburbs is at a 5 year low, with the availability rate under 20% for the first time in five years.
- 128 Central lead the submarkets with 1.49 MSF of net absorption. In the 128 Central submarket, Bedford saw the most net absorption with 522,388 SF and with Burlington, Lexington and Waltham combining for much of the remainder.
- Despite the initial feeling that asking rental rates would moderate, rents in 128 Central steadily climbed throughout 2007. Alternatively, while 128 North saw availability decline and more net absorption this year than last year, asking rents have decreased.
About DTZ FHO Partners
DTZ FHO Partners is a commercial real estate firm offering a full range of brokerage, consulting, strategic planning, research, lease administration, marketing, lease auditing, lease portfolio and transaction management services for corporate and institutional clients alike. The senior partners of the firm have worked together for over 20 years providing customized advisory consulting and brokerage services to an extensive range of corporate and institutional clients, both locally and on a national and international basis. The experienced professionals that make up DTZ FHO Partners have addressed the real estate needs of many industries including life sciences, high-tech, and financial services as well as law, consulting, accounting and other professional firms, assisting clients to develop and implement customized real estate solutions that enhance their overall business strategies. More information about DTZ FHO Partners can be found at http://www.fhopartners.com or by calling 617-279-4555.