215 Million Square Feet of Office Space Under Construction, But Slowing

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Robison Wells
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A recent consensus from the American Institute of Architects predicted an 11% decrease in office construction. Tech-driven cities such as Manhattan, Boston, Seattle, Los Angeles, and the Bay Area drive the growth. Builders constructed 25 million square feet of office space in the first two months of 2021, with more coming.

Manhattan leads the way with almost 22 million square feet under construction at the end of March. Chelsea and Mitsui Fudosan America’s 50 Hudson Yards host most of the building, scheduled to be finished in Q1 2022. The property will include New York City’s fourth-largest office tower.

Boston shows a construction acceleration in Cambridge, where vaccine-developer Moderna is based. The project features 16.6 million square feet, including a 43-acre mixed-use development and three office buildings at MIT Investment Management Co.

Seattle and the Bay Area, both pillars of the tech community, show significant growth. The former sees major additions to office space at Amazon, Microsoft, Google, and Facebook; the latter boasts its most significant project, the Adobe North Tower, Adobe’s fourth tower in downtown San Jose.

Los Angeles—not a tech center—outlies the others. But its growth includes 10.2 million square feet, comprised of two massive projects: The California Market Center and Waterbridge Capital’s 801 Broadway.

In a press release, the American Institute of Architects said: “The dramatic downturn in office employment will limit the need for new facilities. Additionally, though, many businesses have found telecommuting to be an attractive option, and many workers feel safer at home, particularly those relying on public transportation for their work commute. Others don’t mind avoiding their commute, even in the safety of their car. Spending on office construction is expected to decline 11% this year, and almost 8% next.”

With telecommuting on the rise, demand for office space construction wanes, although large-scale construction projects remain on the horizon.

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