Most Philadelphia office space brokers and investors consider Market Street West – the portion of Market Street running from City Hall to 21st Street – as Center City’s premier office district, and with good reason.
Public transit access is exceptional along that corridor, which is home to more than 12 million square feet of Philly office space; this is more than double the amount of office space located on other major Center City thoroughfares such as JFK Boulevard, South Broad Street, or Market Street East.
This CoStar report is being offered through Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm specializing in Philadelphia commercial real estate listings.
However, Market Street West’s concentration of modern office skyscrapers has made it a favorite among large, publicly traded companies based in Philadelphia, a feature which is both a blessing and a curse for local office landlords dealing in Philadelphia office space.
Clearly, Market Street’s popularity among large tenants is a plus for landlords that can retain them. Giant long-term leases by companies such as Independence Blue Cross or Beneficial Bancorp help some office owners keep large portions of their Philly office space properties filled for years or even decades on end.
The problem is that thanks to high business costs, Center City’s Philadelphia office space does not have a strong track record when it comes to attracting and retaining large corporate headquarters. Many of Philadelphia’s largest white-collar employers such as Sunoco, Dow Chemical and PNC have all either vacated or downsized their Market Street office space in recent years as part of cost-cutting efforts.
The result is that, in terms of the percentage of office availability rates, Market Street West does not stand out as a particularly tight Philly office space market today.
The tightest Philadelphia office space micro markets (in terms of both physical vacancy rates and percentage of space listed as available for lease) are currently Rittenhouse Square and Logan Square. Both are located a few blocks off Market Street and are home to some of Center City’s most coveted public greenspaces.
In contrast to Market Street West, the bulk of Philly office space stock in the Rittenhouse Square area is comprised of office properties located along Walnut Street, smaller than 350,000 square feet and built before 1970.
These properties cater almost exclusively to tenants looking for Philadelphia office space of less than 15,000 square feet, often in industries like legal services, healthcare, and accounting. These mostly privately-held firms do not face the same scrutiny from public shareholders and as a result, are less likely to relocate out of Center City to cut costs.
From an owner’s perspective, one downside associated with owning these older, smaller Philly office space properties is the constant time and money spent shuffling tenants in and out, as having smaller tenants means more lease expirations.
However, these Philadelphia office space properties have maintained higher average occupancy rates in recent years than most of the newer skyscrapers along Market Street. As a result, available office space is also harder to find in and around Rittenhouse Square and Logan Square than it is in any other major office district of Center City.
For more information about Philly office space or other Philadelphia commercial properties please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) at Wolf Commercial Real Estate, a premier Philadelphia commercial real estate broker that specializes in Philadelphia office space.
Wolf Commercial Real Estate, a full-service CORFAC International brokerage and advisory firm, is a premier Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, property management services, and marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.
Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with extensive expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philadelphia office space with the Philadelphia commercial properties that best meet their needs.
As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals. If you are looking for Philly office space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.
Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties and Philadelphia commercial real estate listings for lease or sale through our Philadelphia commercial real estate brokerage firm.
