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CushWake Report: Tech Occupiers Cement Position in U.S. Leasing Market
Tech companies aren’t just invading our iPhones, they’re invading our real estate as well. In 2018, the technology sector in the U.S. cemented its position as a major driver of the country’s economy and office market. According to a report published this week by Cushman & Wakefield, venture capital investments nearly doubled in 2018, rising from $72 billion to $131 billion.
Ken McCarthy
The report looked at the economic impact of the 40 largest leases in 86 office markets. Cushman & Wakefield Ken McCarthy, Principal Economist, wrote it wasn’t surprising to find that tech companies, backed by $133 billion in venture funding, were the largest lessor of office space in the U.S. in 2018, accounting for more than a quarter (25.7%) of the 311.9 million square feet of new leases signed in the U.S.
Cushman & Wakefield reports the average lease size of a tech company is 71,428 square feet. Comparatively, non-tech companies’ average lease size is about half – or 36,200 square feet.
Tech is really a very diverse set of industries, wrote Cushman & Wakefield. Tech is not just hardware and software. A total of 46 individual industries are included in the tech sector mix. The industry that leased the most space in 2018 was the life sciences sector, which accounted for nearly 20% of total tech leasing last year.
Top Cities/Areas tech leasing activity:
– Silicon Valley: 78.1%
– Salt Lake City: 66.4%
– Greater San Francisco: 60.9%
– Boston: 47.7%
– Seattle: 46.8%
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