Pittsburgh Office Market
| Average Asking Rent (Price/SF) | $24.78 |
| Vacancy Rate (%) | 20.8% |
| Net Absorption (SF) | -165,521 |
Ramifications from COVID-19 continued to impact the nation throughout 2021. Glimmers of normalcy emerged despite the year ending with another new variant. Adaptation has become the new normal as businesses develop solutions to co-exist with the stubborn nemesis.
Several trends impacting the office sector have strengthened or resulted from the pandemic throughout the year. While greater than 2020, the velocity of activity continued to be below pre-pandemic levels and average transaction size has dropped to single digits. Companies are beginning to recognize the need for a physical office to maintain culture and business operations, but they continue to struggle with appropriate space requirements, configuration and work week structure. Many users have opted for shorter lease terms and increased requests for early termination options, exercising a ‘wait-and-see’ approach to better understand the direction of their businesses. Further, tenant renewals have turned into a heightened degree of tenant relocations. Increasing inventory availability and attractive deal structures have encouraged a more robust flight to quality.
Download Pittsburgh Office Market Report 4Q21
Pittsburgh Industrial Market
| Vacancy Rate Rate (%) | 5.9% |
| Net Absorption (SF) | 166,724 |
The fourth quarter of 2021 provided mixed results, but the year ended on a positive note with market conditions trending positively for continued strength and growth in 2022. While inflation fears continued to add volatility to the stock market and economists debate if inflation is transitory or secular, the industrial market continued to show signs of relative strength. Several speculative building projects were delayed as construction costs and supply chain issues continued to rise, although signs of leveling off may be on the horizon. Regardless, any projects starting in early 2022 are targeting late 2022/early 2023 delivery, which will lead to an ever-tightening market and expected higher lease rates in 2022.