Philadelphia’s commercial construction industry is starting off the 2020s strong, with eight major office buildings in varying stages of planning and construction in just Center City and University City.
From the Philadelphia Business Journal:
So much new office construction is currently proposed for Philadelphia that it rivals the late 1980s and early 1990s, when an onslaught of office development flooded the market and recast the city’s skyline.
Eight projects totaling 3.6 million square feet are in different stages of planning, marketing and construction for Center City and University City, according to Newmark Knight Frank data. Those figures don’t include commercial projects in the works at the Philadelphia Navy Yard or buildings like those that Jefferson Health is developing for itself adjacent to its Center City campus.
The rise in new office development underscores trends at work in Philadelphia. Companies have become more comfortable spending top dollar to rent new office space in an effort to attract and retain talent in a tight labor market, according to real estate experts speaking at the Newmark Knight Frank annual forecast. …
The underlying factors driving the current development activity are in contrast to the boom of the ’80s and ’90s. Though that was prompted by some business expansion, it was also fueled by speculative development. At the time, five new high rises — One and Two Liberty Place, Mellon Bank Center, Commerce Square and Three Logan — came out of the ground. Though they transformed the skyline, demand for the space wasn’t as robust as anticipated and the vacancies that cropped up became a drag on the city’s office market. …
While there has certainly been new office development in Philadelphia over the last 15 years, it has not been on the scale that is currently proposed. Comcast Center, Comcast Technology Center, Cira Centre and FMC Tower all came out of the ground in recent years and remain occupied.
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Photo Credit: Chris Jaccino