JLL: Micro-urban Demand hot, but is there a cooling trend for suburban campuses?

JLL, Silicon Valley, Palo Alto, Mountain View, Santa Clara, San Jose, technology campus, tech real estate

6.12.14.Chart of the Week SV

52.6 percent of the total square footage of new construction starts between 2012 and 2013 in Silicon Valley has been pre-leased by technology firms prior to breaking ground.

Hot micro-urban demand – Downtown Palo Alto and Downtown Mountain View have approximately 212,000 square feet of office space under construction, 56.1 percent of which has been pre-leased. Most of the new development leased within three months of groundbreaking.

Suburban development slowdown? As of Q1 2014 only 28.8 percent of under construction development has secured a tenant. Despite Ericsson’s pre-lease of 400,000 square feet at Santa Clara Gateway, there are still plenty of space renovated options in North San Jose that are relatively less expensive.

Source: JLL

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