Boston High-Rise Rents Soar Past $90 per Square Foot in the Second Quarter

Following a spate of high-value office property acquisitions, high-rise and class B office rents continue to rise steadily throughout Boston. According to DTZ, a commercial real estate service firm, average rents for low-rise and class B office space currently fall into the low-to-mid $40 per square foot range. Meanwhile, high-rise office space is renting for an average of $90 or higher per square foot.

Naturally, office rent prices vary by neighborhood. The rate at which rents are rising varies too. For example, class B rent prices have gone up by about 20 percent in South Station over the last year. They've increased by about 21 percent in the Financial District. In North Station, class B office rents have increased by about 12 percent. Direct average rents are up by about 5 percent in nine out of 12 sub-areas of Boston.

In the second quarter, the total amount of office space leased by tenants--otherwise known as net absorption--equaled 733,765 square feet. Around 1.2 million square feet have been absorbed since the beginning of 2015. Of the more than 164 million square feet of office space in Boston, 14.1 percent is currently vacant. Around 23 percent of all large leases are taken by tech firms.

The report also highlighted Cambridge for having the strongest real estate market in the city, with $2.2 billion in activity in quarter two alone. East Cambridge has been especially active, with an average of 16.3 percent growth.

Meanwhile, office rent in the suburbs rose about 4 percent over last year. Currently, the average price per square foot to rent office space in the Boston suburbs equals $22.62.

Check with Boston City Properties regularly for the latest statistics and information regarding office space leases in Boston.

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