Every month, JLL’s regional team curates the top commercial real estate industry articles to keep you in-the-know. In this month’s edition, JLL spotlights rising commercial real estate markets, coworking corporations and prestigious office space locations.
Investors Assess Real Estate Market Dynamics
As commercial real estate markets continue to multiply in size and specialisms, no two cities are the same. A new article from JLL Real Views breaks down the peer groups of some of today’s top cities and how the market dynamics in each impact investment.
Factors like affordability and adaptability will continue to influence real estate investment and encourage modern cities to develop new, creative routes to success. And while elite players like London, New York and Hong Kong are positioned as global leaders, emerging mid-sized cities are catching the eye of investors and businesses.
Industry-Specific Coworking Spaces Arise
Co-working memberships are on the rise. In 2017, it’s predicted that nearly 14,000 people worked in communal settings. As co-working becomes a new norm, the landscape may look and operate differently in 2020 than it does today.
Companies like WeWork, Serendipity Labs and Industrious are moving into Midwest markets like Cincinnati, Columbus and Detroit, looking for co-working opportunities to attract independent professionals and entrepreneurs. Millennials, who will account for roughly 3/4 of the workforce by 2030, are driving this trend.
As startups enter the market, a new generation of industry-specific co-working spaces such as agritech- and food-focused spaces may come to fruition—forever changing the traditional office landscape.
Rents Rise as Technology Companies Take Over
Many of the nation’s most prominent technology players are willing to pay top dollar in exchange for a high-profile address.
In fact, five of the 10 of the most expensive U.S. streets are now home to technology giants.
This surge in demand, however, has led to increased competition from financial, legal and consulting firms for office space. Additionally, these high-profile strips command an average asking rent of $48.65 per square foot—nearly 50% more than the rest of the country.
As tech companies continue to lease large blocks of luxurious office space, the professional services industry can expect to see higher rents with each passing year.