Number of Tech Leases in Boston Increased 2 Percent from Last Year
Boston claimed the fifth-largest share of square footage in the 100 largest U.S. office leases by tech firms last year, remaining relatively steady at a 2 percent increase from the previous year, according to a new report from CBRE's Tech Insights Center.
“Despite Boston's modest increase in tech firm square footage, the market continues to see home-grown firms expanding and new firms entering the market,” said Kevin Kennedy, Senior Vice President at CBRE in Boston. “Boston's established tech market, steady flow of graduates from its world-renowned colleges and universities, and the market's new development continue to attract and retain tech firms.”
CBRE's analysis found that the software, search and e-commerce categories together accounted for 62 percent of the square footage in last year's largest U.S. 100 tech office leases, up from a collective 41 percent share in 2018. The gains made by those three tech sectors came as large-scale leasing activity by companies involved in social media, hardware, business services, cloud and media & entertainment industries, lessened compared to previous years.
On the market level, the San Francisco Bay Area remained the capital of huge tech leases with 6.9 million sq. ft. newly leased last year, but its share of square footage in the largest 100 leases declined by 37 percent in 2019 from a year earlier as tech companies expanded to other markets, largely in search of talent.
“The largest tech firms have diversified their expansion plans so that they're no longer overly dependent on one or two markets for hiring talent,” said Colin Yasukochi, Executive Director of CBRE's Tech Insight Center. “Many East Coast markets like New York and Washington, D.C. offer large tech-talent labor pools and a steady flow of tech-degree graduates. Given the tight labor supply and cost pressures in the Bay Area and Seattle – the two largest U.S. tech markets – the diversification trend can be expected to continue.”
To download the full report, click here.
Boston claimed the fifth-largest share of square footage in the 100 largest U.S. office leases by tech firms last year, remaining relatively steady at a 2 percent increase from the previous year, according to a new report from CBRE's Tech Insights Center.
“Despite Boston's modest increase in tech firm square footage, the market continues to see home-grown firms expanding and new firms entering the market,” said Kevin Kennedy, Senior Vice President at CBRE in Boston. “Boston's established tech market, steady flow of graduates from its world-renowned colleges and universities, and the market's new development continue to attract and retain tech firms.”
CBRE's analysis found that the software, search and e-commerce categories together accounted for 62 percent of the square footage in last year's largest U.S. 100 tech office leases, up from a collective 41 percent share in 2018. The gains made by those three tech sectors came as large-scale leasing activity by companies involved in social media, hardware, business services, cloud and media & entertainment industries, lessened compared to previous years.
On the market level, the San Francisco Bay Area remained the capital of huge tech leases with 6.9 million sq. ft. newly leased last year, but its share of square footage in the largest 100 leases declined by 37 percent in 2019 from a year earlier as tech companies expanded to other markets, largely in search of talent.
“The largest tech firms have diversified their expansion plans so that they're no longer overly dependent on one or two markets for hiring talent,” said Colin Yasukochi, Executive Director of CBRE's Tech Insight Center. “Many East Coast markets like New York and Washington, D.C. offer large tech-talent labor pools and a steady flow of tech-degree graduates. Given the tight labor supply and cost pressures in the Bay Area and Seattle – the two largest U.S. tech markets – the diversification trend can be expected to continue.”
To download the full report, click here.
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2019 revenue). The company has more than 100,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 530 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.
CBRE Group, Inc. (NYSE:CBRE), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2019 revenue). The company has more than 100,000 employees (excluding affiliates) and serves real estate investors and occupiers through more than 530 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.