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Concessions under pressure, leasing in spec-space surges
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 * Americas
   * Argentina
   * Brazil
   * Canada
   * Chile
   * Colombia
   * Mexico
   * Peru
   * United States
 * Europe Middle East and Africa
   * Belgium
   * Finland
   * France
   * Germany
   * Ireland
   * Israel
   * Italy
   * Luxembourg
   * Netherlands
   * Poland
   * Portugal
   * Saudi Arabia
   * Spain
   * Sub-Saharan Africa
   * Sweden
   * Switzerland
   * United Arab Emirates
   * United Kingdom
 * Asia Pacific
   * Australia
   * China (Mainland)
   * Chinese Taipei (Taiwan)
   * Hong Kong SAR, China
   * India
   * Indonesia
   * Japan
   * Korea
   * Macau SAR, China
   * Malaysia
   * New Zealand
   * Philippines
   * Singapore
   * Sri Lanka
   * Thailand
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Snapshots


WITH CONCESSIONS UNDER PRESSURE, LEASING IN PRE-BUILT SPACE SURGES

November 01, 2023
Contributors:
 * Jacob Rowden
 * Elena Lanning

 * As tenants have shifted into more defensive strategies and landlord
   concession packages continue to face pressure from capital costs, pre-built
   spaces including sublease listings and spec suites are generating heightened
   occupier attention and have seen more robust leasing activity in recent
   quarters as a result.
   

 * As sublease listings and spec suites have become more prevalent, leasing in
   these spaces comprised 24% of gross leasing in Q3, the highest share in more
   than 10 years. As a result, gross leasing activity in pre-built spaces has
   grown for two consecutive quarters, and in Q3 reflected 90% of pre-pandemic
   levels.

 * Despite upfront landlord costs, pre-built spaces can minimize other
   concessions and support effective rents: the highest-rent lease year-to-date
   was AIMCO’s nine-year lease in SL Green’s One Vanderbilt which was executed
   at $247 per s.f. for pre-built turnkey space.

 * Active tenants continue to target pre-built sublease listings to procure
   high-end space at discounted rates: OpenAI recently executed the largest
   lease of 2023 in the San Francisco Bay Area, subleasing nearly half a million
   square feet of Uber’s Mission Bay headquarters.


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