The asking office rents in Philadelphia have remained resilient and even increased in recent years. However, effective rents, which account for inflation and concessions, paint a more complex picture. As a result, asking rents are no longer as reliable an indicator of occupancy costs and office market performance as they once were.
From 2010 to 2019, annual asking office rents in Philadelphia grew by an average of 1.6%, closely tracking the national inflation rate of 1.7%. But in recent years, inflationary pressures combined with reduced office demand have driven effective rent growth into negative territory.
For example, in the third quarter of 2024, average office asking rents rose by 0.4%. However, after adjusting for inflation, the average effective rent declined by 3%. When factoring in concessions and other incentives, the decline becomes even steeper.
Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier commercial real estate broker that provides a full range of commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other commercial properties for buyers, tenants, investors and sellers.
Please visit our websites for a full listing of Philadelphia commercial properties for lease or sale, www.wolfcre.com.
