HOT START TO THE NEW YEAR FOR BOSTON
Setting the tone for 2019, the office market has seen an increase in asking rates and decline in vacancy, both of which are likely to remain the trend through the year with limited availability projected for 2019. Despite limited availability projected for the remainder of 2019, the development pipeline in Boston will bring relief to the tight market in the years to follow. The One Congress Tower, a one million square foot office tower expected to break ground this summer, is one of the major developments that will bring new space to the market when it opens in 2023. The tower has already locked down a major tenant in State Street who will be relocating from their longtime home at One Lincoln Street. On the flipside of that equation, WeWork will backfill a significant portion of State Street’s space at One Lincoln after signing their largest lease yet in Boston at the former financial services giant’s headquarters.
On a macro level, the region’s demographics and economy have remained solid helping to support and promote Boston’s recent expansion. Firmly rooted in education, technology and life sciences, Boston’s diverse economic base has submitted strong job growth through increased recruitment and skilled labor retention from the area’s leading universities and institutions. Looking forward, expect durable market conditions and a diversified economy to guide the region’s commercial real estate market to a strong performance over the next few years.