Intelligent Investment

Renewals Dominate Top 100 Office Leases of 2023

February 8, 2024 3 Minute Read

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Renewals accounted for 58% of the top 100 office leases in 2023, a reversal from 2022 when new leases dominated. Cost containment in an uncertain economic environment was the prime motivation for many occupiers to renew their leases rather than take new space.

The 100 largest leases in 2023 totaled 26.8 million sq. ft., down from 30.4 million sq. ft. in 2022 and accounting for 15.0% of total office leasing volume vs. 13.7% in 2022. The average lease size of the top 100 fell by 12% year-over-year to 267,558 sq. ft. Office occupiers continued to rightsize their portfolios due to lower average space utilization rates.

The top 100 leases reflected broader flight-to-quality trends, with three-quarters of those leases for space in Class A/A+ buildings. The trend is even more pronounced among new leases in the top 100, 84% of which were for space in Class A/A+—well above these top-tier buildings’ 61% share of total U.S. office inventory.

Figure 1: New Leases in Top 100 by Building Class

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Source: CBRE Research, Q4 2023.

Government replaced the finance & insurance sector for the greatest share of top 100 office leases in 2023, primarily due to reduced private sector leasing activity and the expiration of several large government agency leases. With 19 of the top 100 leases (more than twice as many in 2022), the government sector had a one-fifth share totaling 5.8 million sq. ft. Fifty-eight percent of government leases were renewals, predominantly in the Mid-Atlantic region. The finance & insurance sector accounted for 13 of the top 100 leases, down from 25 in 2022 due to economic headwinds and continued rightsizing.

Technology companies had 11 leases totaling 3.6 million sq. ft. among the top 100, down from 17 totaling 5.9 million sq. ft. in 2022. More than 60% of tech sector leases were in the Pacific region.

Figure 2: 2023 Top 100 Office Leases by Industry

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Source: CBRE Research, Q4 2023.

With a preponderance of gateway markets, the Northeast and Pacific regions accounted for most of the top 100 leases by total square footage. Manhattan, Silicon Valley and New Jersey had a combined share of 41%.

Figure 3: 2023 Top 100 Office Leases by Region

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Source: CBRE Research, Q4 2023.