4th Quarter 2021 Tampa Bay Office Market Report and 2022 Forecast

Important Highlights:

Tampa Bay:

• Office space leasing has been increasing rapidly close to what it was pre-pandemic 
• The unemployment rate in Tampa Bay decreased to 4.9 % in December of 2021 and is expected to decrease even more in 2022
• Average direct asking rentals are up .5 percent from last quarter, soon to be back at pre-pandemic rates
• Rent is up 28% in the Tampa Bay Area 

Let’s Talk Rent Numbers:

2022 1st Quarter Forecast: 

• Confidence in the Tampa Bay market is high, going into the last quarter of 2022 amid sustained new-to-market tenancy.
• Tenants will proceed to bring their teams back to the office more so in 2022
• By 2022 remaining new construction space with many buildings is expected to be over 60% leased. 

What does this mean for Tenants?

•  Managing market expectations in key areas where office vacancies are higher than in Tampa Bay. Due to lower vacancy rates than key markets such as New York and Los Angeles, landlords in Tampa Bay are not as driven to replace vacancies as they are in other areas of the country.
• Use available sublease space to take advantage of the market conditions we do have, which can give more reasonable rates, shorter terms, and any available furnishings.

What does this mean for Landlords?

• To acquire a competitive advantage against Landlords who retain their face rates, evaluate concessions for tenants by changing asking rents and increasing Tenant Improvement Allowances. 
• Make lease terms more flexible. 
• Expect a surge of new products to hit the market. Tenants from other states are growing or migrating to Tampa. 
• Start marketing available space 6 with a longer lead time for office space that will become available in the near future.