Top 5 Markets for Office Deliveries

The U.S. office sector is still reeling, as funds remain hard to come by and large leasing deals are few and far between. The construction pipeline has decreased significantly, with 76.9 million square feet of office space underway as of June. The number represents only 1.1 percent of existing office inventory, showing that demand for office space is unlikely to return to prepandemic levels. Below, we’re highlighting the top metros for office deliveries at a time when office development is stalling.

With increased interest rates and low demand, developers delivered only 27.8 million square feet, marking a 19 percent year-over-year decrease, while 12.1 million square feet broke ground. The life science sector returned to historical averages in 2024, accounting for just 9 percent of the total office square footage in the first half of the year.

The following list shows the leading five markets for office completions in the first half of the year, ordered by total square footage added. These five office markets, with three of them located in the Western region, contributed a total of 11.5 million square feet to the national office inventory, or 41 percent of all new space to come online.

1. Seattle

Continuing to show signs of improvement in terms of completions, Seattle led the list with 3.4 million square feet of delivered office space across eight properties. The number represented 12.0 percent of the total square footage delivered nationally.

Compared to the first half of 2023, office deliveries in Seattle increased considerably—only 294,725 square feet had come online across three developments, accounting for only 8 percent of the total square footage delivered.

As of June, 5.8 million square feet of office space was underway in Seattle. One of the largest projects to come online in the metro is Amazon’s Bellevue 600. The two towers will total more than 1.5 million square feet in the Bellevue submarket.

2. Boston

Boston followed in terms of completions, with 2.9 million square feet across 12 projects through the first six months of the year, accounting for 10 percent of all national completions. In 2023’s first half, eight office projects totaling 2 million square feet came online.

One significant office development that hit the market is the first phase of Andover Technology Park, in Andover, Mass., coming online in January. The 250,000-square-foot life science and innovation project developed by Celera Properties and True North Management Group consists of the redevelopment of two buildings.

The metro’s completion pipeline shows a 48 percent year-over-year increase, while its under-construction pipeline stood as the largest one nationally, with a total of 12.9 million square feet of office space underway, leading the nation and accounting for nearly 5 percent of the total stock.

3. San Diego

San Diego continued to show a strong trend in office completions, with approximately 2.1 million square feet across eight office properties coming online. The number made San Diego one of the best-performing office markets in terms of deliveries, showing a consistent increase compared to the same period last year, when developers delivered only 144,113 square feet of office space.

One significant office project that came online is the $1.5 billion Research and Development District’s Phase I, a two-building life science campus delivered in January. The 1.1 million-square-foot campus dubbed The RaDD is developed by IQHQ and is the first urban life science waterfront project to come online in San Diego.

So far in 2024, the life science hub performed well not only in terms of deliveries: Developers keep adding office projects, with San Diego’s under-construction pipeline reaching nearly 3.9 million square feet, leading the Western region in terms of percentage-of-stock basis, clocking in at 4 percent.

4. San Francisco

San Francisco saw 1.7 million square feet of office space delivered across nine properties, accounting for 6 percent of total national deliveries through the first six months of the year. The metro increased its completed office space inventory significantly when compared to the same period of last year, when developer delivered 597,511 square feet across six properties.

The total square footage of completed office space in San Francisco marked a 182 percent increase when compared to the first six months of 2023. One significant office project that entered the metro is Boston Properties’ 651 Gateway Boulevard, a life science building that came online in March. The 327,000-square-foot, 16-story property was a redevelopment project of a 1986-completed building in South San Francisco.

However, when compared to 2022’s numbers, when San Francisco’s office deliveries reached 2.6 million square feet, completions in the first six months of this year showed a 35 percent drop.

Developers have 5.6 million square feet of projects currently underway in the metro across 25 properties, placing it among the best-performing metros in terms of development. The number accounts for 3 percent of total stock.

5. Houston

There were nearly 1.4 million square feet of office space across 12 properties that came online in the first half of 2024 in Houston, accounting for 6 percent of total national deliveries. Compared to the same period of last year, when 1.3 million square feet of space entered the metro, there was a 4 percent increase in deliveries.

The percentage also increased since 2022, when in the first half of the year 1.1 million square feet of completed office space was added to the metro. That marked a 31 percent rise, showing that Houston is on an upward trajectory.

In February, after more than three years of development, Skanska’s 1550 on the Green was officially delivered. The 28-story office building totals 375,000 square feet and already reached LEED Platinum, WELL Platinum and WiredScore Platinum certifications.