- Office Makes its Comeback - Leasing Activity Hits Five-Year High -
As summertime emerges, so have businesses and economies, report SIOR members in the second quarter SIOR Snapshot Report. The report provides member feedback on the performance of transactions and the current state and future predictions of the market. SIORs say commercial real estate (CRE) is rebounding at a record pace, with the office sector finally making its comeback.
Market confidence grew to its highest on record, at 7.6 (out of 10).
- The largest increase was seen in the office sector, rising from 5.9 in Q1 to 6.7 in Q2.
- Industrial confidence remained steady at 8.0.
On-schedule deals have also reached their highest levels in a year, with office being the primary growth factor.
- 79% of transactions are on schedule, a nearly 150% increase since Q2 2020 (32%).
- 77% of office transactions are on schedule, a 175% increase from a year ago when only 28% were progressing.
- On-time industrial transactions slightly dipped but remained strong at 80% in Q2.
Overall leasing activity rose to its highest level in more than five years, with 72% of SIORs reporting more leasing. This was a 16% increase from Q1 (62%).
- Office brokers accounted for the main increase, with 68% reporting higher leasing activity, up from 38% in Q1.
- Industrial office leasing saw little change with 74% still noting higher activity.
“The results speak for themselves – while each sector tells a slightly different story, commercial real estate looks more and more resilient,” says SIOR CEO Robert Thornburgh, SIOR. “This report shows the quantitative results behind the world’s top brokers who weathered the pandemic storm and dug in their heels to grow and deliver innovative results to their clients, no matter what the situation.”
The full report can be found on SIOR’s Thought Leadership page.