July 12, 2018
ATLANTA – The national average rent in transit-accessible office buildings was 65 percent higher than the average market rent in early 2018, Transwestern reports in a new analysis of mass transit’s influence on the office market. The examination of 15 major metros shows average rent in Central Business Districts was $43.48 per square foot NNN for transit-accessible buildings versus $26.01 per square foot NNN for car-dependent buildings. Transit-accessible office space was also at a premium in the suburbs, with average rent of $33.43 per square foot NNN being nearly 50 percent higher than rent in car-dependent buildings.
“As workplace amenities have become increasingly important to companies in attracting and retaining talent, tenants are most certainly keeping accessibility to mass transit on their radar when surveying office product,” said Brian Landes, Director of GIS/Location Intelligence for Transwestern. “Not surprisingly, vacancy for transit-accessible buildings is lower than overall vacancy, which makes these buildings extremely attractive to commercial real estate investors.”
In the analysis, transit-accessible buildings are defined as those within a 10-minute walk from a subway, commuter rail or light rail facility. Based on the combined statistical areas in the set (Atlanta, Boston, Chicago, Dallas, Denver, Houston, Los Angeles, Miami, Minneapolis, New York/New Jersey, Phoenix, San Francisco, Seattle, St. Louis and Washington, D.C.), approximately 39 percent of total office inventory is categorized as transit-accessible, while the remainder is car-dependent.
Atlanta’s percentage of transit-accessible office inventory is slightly below the national average, coming in at 33 percent of all office space, or 71 million square feet. The average rent for these buildings was
$27.44 per square foot NNN at the end of the first quarter, which is 7 percent higher than the average for metro Atlanta.
“As transit becomes increasingly important for Atlanta office users, we are seeing vacancy in transit-accessible properties average 30 percent below other properties, allowing those owners to achieve higher rents,” said Keith Pierce, Transwestern’s Southeast Director of Research. “And, almost every major new development underway is taking transit into consideration.”
To see how the 15 markets compare, visit http://www.twurls.com/masstransit
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