When it comes to the priciest office rents, coastal markets dominate this aspect of the commercial real estate industry.
In a new study issued by JLL Research
, nine of the 10 most expensive streets for office rent are either in West or East Coast metro areas. San Francisco’s Sand Hill Road (where rents average $119.38 per square foot) and Mission Street ($93.68 per square foot) ranked first and third, while New York’s Fifth Avenue ($116.04 per square foot) ranked in second place. Boston’s Main Street ($90 per square foot) and Greenwich Avenue in the affluent town of Greenwich, Conn. ($86.53 per square foot) placed fourth and fifth.
Rounding out the top 10 were Pennsylvania Avenue in Washington, D.C. ($80 per square foot), Ocean Avenue in Los Angeles ($78.20 per square foot), Boylston Street in Boston ($68.87 per square foot), Royal Palm Way in West Palm Beach ($61.80 per square foot) and, for the sole non-coastal market, Congress Avenue in Austin, Texas ($58.20 per square foot).
JLL pointed out that five of the top 10 expensive streets were located in tech hubs. “As tech companies mature, their space needs begin to mirror those of traditional white-collar industries in these expensive locations,” said Scott Homa, JLL director of U.S. office research. “Sand Hill Road is no longer the only example of this. We see it in cities like Boston, Cambridge and Austin where major tech players have leased large blocks of premium space.”
And it seems that people willing to pay a lot more to have an office on a pricey street. JLL also noted that 12.8 percent of the nation’s most expensive real estate is vacant, which is 250 basis points lower than the U.S. average.