As we ease into the fall season, the imminent arrival of the colder months of the year is also fueling office construction in the U.S. Developers are picking up the pace, trying to meet delivery schedules and complete their projects before the year comes to an end. Demand for bigger and better office developments is high, as companies continue to expand and increase their payrolls in sought-after markets like Manhattan or the Bay Area. Various large office projects are currently underway all across the country, so we thought the change in seasons was the perfect time to check in on what’s happening on the U.S. office construction market.
We enlisted the help of Yardi Matrix data to see what the U.S. office pipeline has in store for the remainder of 2017. The final leg of the year looks promising: 215 buildings with over 50,000 square feet are scheduled for delivery over the fall and winter months, amounting to nearly 48 million square feet of brand new office space. Unsurprisingly, the most attractive markets for new construction are also the most expensive: New York City and California.
The Bay Area continues to draw in technology companies, and is home to some of the largest names in the world today–Apple, Google, Facebook and Oracle are just a few of the tech giants based on the West Coast. New York City, one of the most expensive office markets in the world, reigns supreme as the primary target for investment in the country. Other markets such as Dallas and Seattle are also rising through the ranks, with various new projects scheduled for delivery by year-end 2017.
To get a better picture of what’s to come over these next four months, we compiled a list of the top 20 cities poised to accrue the most office completions by the end of the year. New York City, alongside California–and the Bay Area in particular, are likely to steal the spotlight in terms of deliveries through December. We’ve also put together a round-up of the 10 largest office projects set to come online in these next four months. Check out the lists below and scroll down for some market highlights:
Office Construction Booming in Brooklyn, Manhattan
One SoHo Square, Manhattan (via Yardi Matrix)
The top market for office construction for the fall and winter seasons is–drum roll–New York City. It shouldn’t come as a shock that the Big Apple continues to reign supreme as the main target for office investors in the U.S., since it boasts some of the highest prices in the world and local and offshore investors battle for a chance to own a slice of this prime office market. Another interesting fact to note is that our analysis only included the Manhattan and Brooklyn office pipelines, and yet the city still managed to land the top spot, with 15 buildings totaling 5.2 million square feet of space currently underway.
The largest new Manhattan office project scheduled to come online during the last part of 2017 is the 768,000-square-foot One SoHo Square. Located at 233 Spring St. in Manhattan’s Hudson Square submarket, the 13- and 15-story high-rise is owned by Stellar Management and includes 20,000 square feet of retail space. Completion is scheduled in September.
Full Steam Ahead for Bay Area Office Construction
The California office scene will be one of the busiest markets for new deliveries over the next months, taking eight spots on our top 20 list. While the city of Irvine, Calif., managed to land Orange County the sixth position on the list, and Los Angeles closed the list at number 20, the Bay Area made the cut a total of six times. The second spot on our list is occupied by San Francisco, where eight buildings totaling 3.7 million square feet of office space are scheduled for delivery over the last four months of 2017.
The largest project currently underway in San Francisco is the 1.4-million-square-foot Salesforce Tower, scheduled for delivery in October. The 61-story high-rise located at 415 Mission St. is owned by Boston Properties and hopes to earn LEED Platinum certification. A number of high-profile tenants have already committed to space in the tower, including Salesforce, Accenture, CBRE and Bain & Co. Upon completion, the Salesforce Tower will also feature 10,400 square feet of retail space.
Cupertino, Calif., which occupies the fourth spot on our list, is getting ready to welcome the 2.9-million-square-foot Apple Park campus at 10955 Tantau Ave. in the fall. Tech giant Apple’s new ‘spaceship’ corporate campus has been in the works since 2014, and will be the crown jewel of the tech-heavy Bay Area market upon completion.
Plano Office Market Keeping Busy in 2017
Toyota Headquarters at Legacy West, Plano, Texas (Yardi Matrix)
The third spot on our list of top 20 cities is occupied by Plano, Texas, where four buildings totaling 3.3 million square feet of office space are underway, with delivery dates between September and December. The city hit the development jackpot with Legacy West, a 250-acre mixed-use project located on the southwest corner of the Dallas North Tollway and State Highway 121. When finalized, the massive project will include office space, a 292-key hotel, a high-end shopping center and more than 600 apartments, according to KDC.
Suburban Dallas’ new ‘urban village’ will be home to Toyota’s North American headquarters and a 265,000-square-foot FedEx Office headquarters. The upcoming milestone in the development of Legacy West will be the delivery of the 1.4-million-square-foot JPMorgan Headquarters at Legacy West, scheduled for delivery in October.
Texas makes a total of four appearances on our top 20 list. The Dallas office market will welcome six new projects totaling 1.2 million square feet of office space, while Houston also has six projects in the pipeline, amounting to 746,718 square feet. The 18th spot on the list is occupied by Austin, where seven office developments totaling 731,544 square feet of new office space will come online by the end of the year.
Methodology
- Data source: Yardi Matrix;
- Data recorded until August 28th, 2017;
- Square footage parameters: over 50,000 square feet;
- Pipeline time frame: September 1st to December 31st, 2017;
- Only office spaces within buildings operated primarily for office use were taken into consideration;
- *New York City under construction data only includes Manhattan and Brooklyn.
