Market Report | Office | January 2023
Quincy/Braintree Report Summary
The Quincy/Braintree Submarket in Boston is a very large submarket that contains roughly 10.9 million SF of office space. The vacancy rate has risen moderately over the past 12 months, and at 11.3%, the rate was above the long-term average as of 2023Q1.
Net absorption was negative over the past year. This is a continuation of the trend: Annual net absorption has averaged -71,000 SF over the past five years.
Rents edged up by 0.7% over the past year, which significantly trails the area’s average annual growth rate of 3.5% over the past decade.
There are no supply-side pressures on vacancy or rent in the near term, as nothing is under construction. Moreover, the inventory has actually contracted over the past 10 years, as demolition activity has outpaced new construction. Office properties traded with regularity last year, consistent with the generally high level of activity over the past three years.
Route 3 South Report Summary
The Route 3 South Submarket in Boston is a midsized submarket that contains around 5.9 million SF of office space. The vacancy rate has been essentially unchanged over the past year, but at 4.2%, the rate was a bit below the 10-year average as of 2023Q1.
Net absorption was essentially flat over the past year. Things look better over the five-year timeframe, as the submarket has posted 28,000 SF of positive net absorption per 12 months on average.
Rents increased by 2.0% over the past year, firmly positive but well below the 3.5% average change over the past decade. The 5,000 SF currently underway in Route 3 South is the lowest amount of space in the pipeline in more than three years.
This represents a continuation of new development in the submarket, which had already seen 17,000 SF deliver over the past three years. Office properties traded with regularity last year, consistent with the generally high level of activity over the past three years.
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