TRG | The Bottom Line – 10/21

TRG’s office move this week and JLL’s office market report released this past week prompted us to dust off office stats. According to JLL, 46.6MM square feet of new office starts broke ground YTD, and expectations are that 2022 will match last year’s 62MM square feet of new commercial stock brought to market. Sunbelt states continue to drive demand – new and planned office starts in Austin, Charlotte and Nashville are expecting gains ranging from 15% to 23%. National office vacancy rates increased 180bps to 16.6%, a trend that we expect to continue as fewer leases are renewed. Commercial office is far from settled since Covid, with demand for flexible office space continuing to increase. In JLL’s Future of Work Survey, 43% of firms plan to increase investment in flex space through 2025. While the numbers paint a “not so terrible” outlook, we are hearing just this past week of hiring freezes in the commercial real estate industry (and in our own backyard, Nashville). TRG is eating our own cooking and taking a different approach to our office needs – stay tuned for details later!