Office Prices Fall In CBDs, Rise in Urban Submarkets As Vacancy Rates Level Off

While average sale prices of office buildings in central business districts have fallen to historic lows, prices in urban submarkets are pushing upward, in a move some experts say counters the ‘death of the city’ narrative that’s become so prevalent post-COVID. 

The average sale price of assets in CBDs peaked at $400 per square foot in 2019 and fell to $379 in 2020 before hitting $284 this year, according to a recent analysis from YardiMatrix. But meanwhile, the price of assets in urban submarkets have grown from $399 to $511 per square foot from 2019 to 2021.  Overall, Yardi logged $36.9 billion in office transactions this year through July, putting 2021 on track to surpass 2020 transaction volume.