Through first-quarter 2016, only 6.6 million square feet of new leases were signed compared with 6.9 million square feet during the same time period in 2015. A large factor in this 6 percent decline was the limited number of new leases signed greater than 100,000 square feet, with only five completed this year compared with 10 last year. The volatility in the stock market and weakened global markets that started the year may have caused tenants to take a pause, creating this slowdown in large leasing activity in the first quarter.
When all is said and done in 2016, however, this will likely just be a blip on the radar, as there are 69 tenants currently in the market with an average space requirement greater than 100,000 square feet. This total is up from the 49 tenants looking for large spaces one year ago. The total number of tenants looking for spaces with an average between 10,000 and 100,000 square feet is up as well. There are 387 tenants in this size range with space requirements today, compared with only 294 last year at the same time.
It is also no surprise that the top three industry sectors that make up 70.4 percent of the tenants in the market today are financial services, TAMI (tech, advertising, media and information services) and professional services. Below is a breakdown of how these industries’ 10,000-plus-square-foot space requirements stacks up.
• 123 tenants totaling 10.8 million square feet compared to only 82 totaling 8.8 million square feet one year ago.
• 22 of these tenants are searching for over 100,000 square feet compared to only 13 one year ago.
• 103 tenants totaling 4.1 million square feet compared to only 72 totaling 5.2 million square feet one year ago.
• Seven of these tenants are searching for 100,000-plus square feet, the same amount as one year ago.
• 95 tenants totaling 7.8 million square feet compared to only 97 totaling only 4.9 million square feet one year ago.
• 18 of these tenants are searching for over 100,000 square feet compared to only 10 one year ago.