Philadelphia, PA - Office Market Overview
The Philadelphia Metropolitan Area includes the Eastwick, Logan Square, and Navy Yard office space submarkets. With a metropolitan population of over 2.1 million, Philadelphia is known as 'The City of Brotherly Love' and is one of the main historic and cultural centers of American history. Bioscience, financial services, and tourism are three of the primary drivers of the economy in the city and create demand for white-collar office space in the metro area.
As of mid-2017 the Greater Philadelphia office market encompasses over 60 million square feet of existing office space in properties larger than 50,000 square feet. Demand for Philadelphia commercial real estate is also created by the world-class research and educational institutions in the city.
Philadelphia, PA - Office Inventory Description
As the center for economic activity in Pennsylvania, Philadelphia is home to seven Fortune 1000 companies and has been ranked as a city that is an important link within the global economic system by the Globalization and World Cities Study Group & Network.
With a gross metropolitan product of $109 billion annually, there is consistently strong demand from tenants, national and international investors for the white-collar office product in Philadelphia. Nearly 61% of the office inventory in Philadelphia is Class A or A+, with Class B office product accounting for 35% of space on the market.
The Old City office market is home to some of the most historic, Class A office buildings in the metropolitan area. Located along the Delaware River, between Walnut and Spring Garden Streets, the area is home to trophy office property such as Constitution Place, The Bourse, and Riverview Place at 520 North Delaware Avenue.
Philadelphia, PA Commercial Inventory Breakdown
Total: 75,955,806 SF
By square footage range:
- 50k to 100k SF: 5,718,977 SF / 7.53% of total office
- 100k to 500k SF: 22,577,373 SF / 29.72% of total office
- 500k to 1M SF: 33,345,688 SF / 43.9% of total office
- > 1M SF: 14,313,768 SF / 18.84% of total office
- Class A+: 15,418,232 SF / 20.3% of total office
- Class A: 29,535,912 SF / 38.89% of total office
- Class B: 21,397,821 SF / 28.17% of total office
- Class C: 1,596,353 SF / 2.1% of total office
Philadelphia, PA - Green Office Space
The 2017 National Green Building Adoption Index surveyed the top 30 major markets in the U.S. for the adoption of energy-efficient green office building standards. Philadelphia just missed winning a top 10 ranking, coming in at #11 for percentage of green buildings.
3.0 University Place is an excellent example of a green office building in Philadelphia. Proposed for a LEED Platinum certification, this six-story building on 4101 Market Street in the West Powelton neighborhood has nearly 201,000 square feet of space, including ground-floor retail.
Of the office buildings larger than 50,000 square feet in Philadelphia, over 2% are LEED-certified, over 12% have an Energy Star rating, and over 13% of the large office buildings in the city are recognized as being green buildings. In mid-2017, the percentage of green office buildings in the top 30 U.S. markets has reached 38%, while 12 years ago less than 5% of the office space in the country was energy-efficient to current standards.
Philadelphia, PA's Top Office-Using Sectors
The demand for Class A white-collar office space and commercial real estate in Philadelphia is driven by a vibrant mix of both public and private business sectors, including major research universities, financial services, professional services, and Fortune 1000 companies.
- Education & Research – Major research universities such as Drexel University, Temple University, the University of Pennsylvania, and the venture capital industry they attract, all create demand for Class A office space in Philadelphia.
- Financial Services – Philadelphia is home to the Philadelphia Stock Exchange, insurance company Colonial Penn, the Federal Reserve Bank, and numerous other financial services companies that are among the top office-using sectors in the city.
- Professional Services – The American Law Institute, the Third Circuit Court of Appeals, and ten of the 100 largest law firms in the U.S. including Morgan Lewis, and Duane Morris, all create tremendous need for white-collar office space.
- Fortune 1000 – The numerous businesses headquartered in Philadelphia are also top users of office space in the city, including CIGNA, Comcast, Aramark, Crown Holdings, FMC, and GlaxoSmithKline.
- Total Population1,569,657
- Male Population(47.3 %) 742,412
- Female Population(52.7 %) 827,245
- Median Age34.10
- Average Household Income$60,517
- Median Household Income$40,649
- Median Income Under 25$20,445
- Median Income 25-44$47,790
- Median Income 45-64$43,470
- Median Income Over 65$29,206
CRE Events to Attend in the Second Half of 2019
July 12, 2019
The calendar is starting to stack up with a range of exciting Commercial Real Estate (CRE) events to attend in the second half of 2019. Here is an extensive list of the upcoming shows, expos, and CRE events. New England Conference & Deal Making July 16 – 17, 2019, Boston, Massachusetts, U.S. Thi...
Office Building Prices in the Top CBDs
July 10, 2019
There are many variables to consider when looking for commercial assets. You may be looking to lease space for your company or to purchase a building outright as an investment. Every market across the country has its own pros and cons, but historically the central business district is where the ...
Office Building of the Week: The Widener Building
May 24, 2019
Located at 1 South Penn Square at the very heart of Philadelphia, the Widener Building is an emblematic architectural gem that has been a key part of the cityscape for over a century. The iconic edifice was designed and built by Horace Trumbauer, a local builder-planner, and hailed today as one ...