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Two California Markets Experience Growing Sublease Dilemma, Reports CBRE
The amount of office space offered for sublease in the 10 largest U.S. office markets increased by 12% since the COVID-19 pandemic forced a shutdown of local economies in March, according to a new report from Los Angeles-based CBRE. Two California markets, San Francisco (No. 2) and Los Angeles (No. 8) rank among the top 10 for sublease space offered.
New York was the top sublease market, though it only recorded a 2% change from March to June 2020. San Francisco experienced a 33% change in sublease space on the market from March to June, hitting 6.5 million square feet. Meanwhile, in Los Angeles there was 4.8 million square feet of sublease space available, a 28% increase from March to June 2020.
Office space offered for sublease increased by 6.1 million square feet in the 10 markets since March to total nearly 59 million square feet in June, according to CBRE’s analysis. Some of the biggest increases have come in markets with significant technology employment such as San Francisco, Denver and Boston. CBRE notes, tech companies tend to keep extra space to accommodate quick expansion but then seek to shed it in downturns.
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