Research - JUNE 18, 2013

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Office market boosts as hiring builds momentum

by Sara Kassabian

The U.S. office market has begun to stabilize in its recovery as hiring starts to pick up and construction remains below its pre-recession levels, according to Marcus & Millichap’s Second Quarter Office Outlook report.

A steady increase in employment has helped improve the office market. The unemployment rate has improved to 7.6 percent in the past year. And it is predicted employers will create up to 2.5 million new jobs in 2013, a slight increase from the previous year, while office-using employment will increase by up to 4.2 percent. In the first five months, 266,000 full-time office positions have been added.

Office fundamentals are expected to strengthen throughout the rest of 2013; however, leasing growth is expected to remain low overall and revenue is expected to come primarily from occupancy gains as opposed to rent growth in most markets. The technology, energy, trade, education

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