Major Markets Are Milking Tech Dry
If you’re looking for space in the hottest North American tech markets, you’ll be paying an aggregate rent premium of 11% or much, much more, CBRE said Tuesday. The crown goes to East Cambridge, MA, with a whopping rent premium of 87%, trailed closely by Santa Monica’s 85% and 73% for Silicon Valley (pictured), which is home to Google's headquarters. But there's still hope for bargain hunters, as you can find below average rates in Reston/Herndon, VA, the DC metro area, St. Louis’ CBD and Northeast Charlotte, NC. But you better get in soon, as those areas are seeing strong rent growth as tech submarkets have emerged. Tech has created 730,000 jobs since 2009 and has been the top driver of demand through Q2 ’15 with more than 20% leasing activity. In major markets, such as San Francisco, Seattle and Austin, tech centers can account for 60% or more of major leasing. Still, CBRE warns investors to keep expectations grounded: the tech market has historically been volatile. [GS]
