The Pittsburgh office market had quite the summer in 2018. More tenants flock to the urban core, 420 Boulevard of the Allies sold, and District Fifteen is fully leased before delivering.

1. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Fundamentals Forecast
YTD net absorption 598,259 s.f. ▲
Under construction 947,153 s.f. ▲
Total vacancy 16.3% ▼
Average asking rent (gross) $24.11 p.s.f. ▲
Concessions Rising ▲
Q3 2018
Office Insight
The delivery of Riverfront West at 3 Crossings in the third quarter of 2018
added 130,500 square feet of Class A office space to the inventory. The newest
addition in the Strip District was delivered with only 26,000 square feet of
availability. District Fifteen is the next project scheduled for delivery only a
stone’s throw away from where Bombardier, currently located in West Mifflin,
signed for 90,000 square feet at One Waterfront Place. There has been
significant technology company interest in District Fifteen, but it was
Facebook that signed a lease for the entire building. Meanwhile, activity swirls
in East Liberty as site work for a new speculative development called East
Liberty Centre begins yards away from a potential redevelopment of an
existing grocery store, along with new retail, residential and structured
parking.
Outlook
With ever-increasing activity in the Fringe and Oakland / East End submarkets,
along with stable leasing performance in the CBD following myriad corporate
rightsizings, leasing in the suburbs has continued to be limited. The urban
submarkets have collectively garnered approximately 61.0 percent of the
year-to-date leasing by total square-footage. In mid-September, the City of
Pittsburgh closed on the newly renovated 420 Boulevard of the Allies,
removing over 160,000 square feet from the Class A inventory in the CBD
submarket. Looking ahead, there are three feasible scenarios for Pittsburgh by
year-end. Vacancy will trend below 16.0 percent and will be at its lowest level
in the past five years. Urban submarket absorption will double with the
delivery of a fully-leased District Fifteen and the subsequent leasing of new
technology and coworking companies, as well as additional tenant urban
migration. The average asking rate of the urban Class A office space will peak
over $30.00 per square foot.
-1,000,000
0
1,000,000
2014 2015 2016 2017 YTD
2018
Supply and demand (s.f.) Net absorption
Deliveries
Pittsburgh’s urban submarkets have a blockbuster
summer
15.9% 15.8%
16.6%
17.5%
16.3%
2014 2015 2016 2017 2018
Total vacancy
$0.00
$10.00
$20.00
$30.00
2014 2015 2016 2017 2018
Average asking rents ($/s.f.) Class A
Class B
For more information, contact: Tobiah Bilski | tobiah.bilski@am.jll.com
• Tenant migration trend continues, as Bombardier signs for 90,000 square
feet in the Strip District.
• 420 Boulevard of the Allies is bought by the City of Pittsburgh and
168,200 square feet of newly renovated space is taken out of inventory.
• Facebook signs entire 105,000-square-foot District Fifteen in the Strip
District.

2. © 2017 Jones Lang LaSalle IP, Inc. All rights reserved. All information contained herein is from sources deemed reliable; however, no representation or warranty is made to the accuracy thereof.
Class
Inventory
(s.f.)
Total net
absorption
(s.f.)
YTD total net
absorption
(s.f.)
YTD total net
absorption (%
of stock)
Direct
vacancy (%)
Total
vacancy (%)
Average
direct asking
rent ($ p.s.f.)
YTD
Completions
(s.f.)
Under
Development
(s.f.)
Northern I-79 / Cranberry Totals 4,286,907 7,905 10,927 0.3% 9.1% 17.2% $24.53 0 0
East Totals 3,046,536 9,419 6,665 0.2% 26.4% 27.6% $20.22 0 0
North Totals 3,751,808 -16,742 127,818 3.4% 11.5% 11.8% $20.60 103,000 0
South Totals 2,347,259 18,671 65,251 2.8% 12.7% 14.4% $19.29 0 0
Southpointe Totals 2,972,107 -29,993 59,337 2.0% 15.0% 20.0% $22.88 0 0
West Totals 7,046,426 -70,853 32,142 0.5% 18.6% 20.6% $21.52 0 0
Suburban Totals 23,451,043 -81,593 302,140 1.3% 15.7% 18.8% $21.43 103,000 0
CBD Totals 18,969,985 24,815 127,029 0.7% 14.0% 14.7% $27.15 0 50,000
Fringe Totals 8,023,797 120,781 165,485 2.1% 10.4% 16.2% $25.28 130,500 614,700
Oakland / East End Totals 2,057,356 17,192 3,605 0.2% 3.9% 4.4% $25.04 0 282,453
Urban Totals 29,051,138 162,788 296,119 1.0% 12.3% 14.4% $26.62 130,500 947,153
Pittsburgh Totals 52,502,181 81,195 598,259 1.1% 13.8% 16.3% $24.11 233,500 947,153
Northern I-79 / Cranberry A 3,601,749 24,353 18,700 0.5% 7.3% 16.9% $25.47 0 0
East A 1,580,784 8,408 3,213 0.2% 30.1% 30.6% $21.78 0 0
North A 809,347 -8,598 79,114 9.8% 12.9% 13.0% $25.05 103,000 0
Southpointe A 1,909,754 14,746 92,098 4.8% 6.1% 12.6% $23.39 0 0
West A 3,767,504 -35,663 73,780 2.0% 16.5% 19.5% $23.46 0 0
Suburban A 11,669,138 3,246 266,905 2.3% 13.5% 18.6% $23.39 103,000 0
CBD A 13,498,998 22,286 96,407 0.7% 12.0% 12.7% $30.11 0 50,000
Fringe A 2,388,470 93,421 79,555 3.3% 4.1% 15.5% $29.32 130,500 577,200
Oakland / East End A 969,243 -508 -2,495 -0.3% 3.1% 4.1% $27.81 0 240,453
Urban A 16,856,711 115,199 173,467 1.0% 10.4% 12.6% $29.97 130,500 867,653
Pittsburgh A 28,525,849 118,445 440,372 1.5% 11.7% 15.1% $27.18 233,500 867,653
Northern I-79 / Cranberry B 685,158 -16,448 -7,773 -1.1% 18.9% 18.9% $22.66 0 0
East B 1,465,752 1,011 3,452 0.2% 22.4% 24.3% $17.93 0 0
North B 2,942,461 -8,144 48,704 1.7% 11.1% 11.4% $19.04 0 0
South B 2,347,259 18,671 65,251 2.8% 12.7% 14.4% $19.29 0 0
Southpointe B 1,062,353 -44,739 -32,761 -3.1% 30.9% 33.4% $22.66 0 0
West B 3,278,922 -35,190 -41,638 -1.3% 21.1% 21.8% $19.81 0 0
Suburban B 11,781,905 -84,839 35,235 0.3% 17.9% 18.9% $19.95 0 0
CBD B 5,470,987 2,529 30,622 0.6% 19.1% 19.6% $21.51 0 0
Fringe B 5,635,327 27,360 85,930 1.5% 13.0% 16.5% $23.71 0 37,500
Oakland / East End B 1,088,113 17,700 6,100 0.6% 4.5% 4.5% $23.50 0 42,000
Urban B 12,194,427 47,589 122,652 1.0% 15.0% 16.8% $22.50 0 79,500
Pittsburgh B 23,976,332 -37,250 157,887 0.7% 16.4% 17.8% $21.11 0 79,500
Q3 2018
Office Statistics
For more information, contact: Tobiah Bilski | tobiah.bilski@am.jll.com