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Which are the top 10 industries that lease office space?
Hi there! Thanks for contacting Wonder for a list of the top ten industries that lease office space. The short version is that the top ten industries that lease office space in the USA are:-
1. Tech
2. Finance
3. Government
4. Law firms
5. Media and entertainment
6. Coworking/real estate
7. Life sciences
8. Health
9. Accounting and consulting
10. Other professional services
Tech captured the largest share of leasing volume in Q1 of 2017 at 24.2%, while the financial sector took the second-largest share at 14.2%.
The picture is slightly different in other parts of the world, with tech accounting for more than 70% of office leasing activity in India, and Business Processing Outsourcing accounting for almost half of the office leasing activity in the Philippines. This could change in the future, however, as US policy shifts may impact demand in these countries.
Below is a deep dive of my findings.
---USA---
According to data from Jones Lang LaSalle Incorporated (JLL), an American professional services and investment management company specializing in real estate, the top ten industries that lease office space in the USA are:-
1. Tech
2. Finance
3. Government
4. Law firms
5. Media and entertainment
6. Coworking/real estate
7. Life sciences
8. Health
9. Accounting and consulting
10. Other professional services
JLL also reports that tech captured the largest share of leasing volume in Q1 of 2017 at 24.2%, while the financial sector took the second-largest share at 14.2%.
Furthermore, the 'Office Outlook' report offers data for different regions of the USA. From this, we can see that Nashville has the lowest vacancy in the country at 6.2%, and in New York, leasing in the TAMI sector (technology, advertising, media and information) fell by 15% following 47% growth since the 2008 recession. Clearly, therefore, while there is a broad overall picture, it is important to recognize regional trends and differences within the USA.
---'NEW TECH'---
While technology is the largest industry in the space, Colliers highlights the growth of so-called 'New Tech' within this sector. 'New Tech' companies are defined by Colliers as "Technology and e-commerce sales and marketing companies founded within the past 20 years". The growth of these companies is reported by Offices.Net, which says: "It is worth mentioning the impact that the new tech sector is expected to have on the US office market during 2017. In many of the nation’s gateway markets, new tech tenants are expected to overtake those in the financial and legal sectors in terms of absorption and take-up rates".
---GLOBAL INSIGHTS---
It is important to note that the make up of the office leasing market is different in other countries of the world. In India, for example, the market is heavily reliant on the tech sector, with companies like Amazon and Oracle accounting for more than 70% of office leasing activity in the country. A further example of global differences comes from the Philippines, where the Business Process Outsourcing (BPO) industry accounts for the largest share of demand for office space at 46%, while the banking and IT sectors each have 12% of total leased space. However, US policy shifts may impact demand in these countries.
---CONCLUSION---
In summary, the top ten industries that lease office space in the USA are:-
1. Tech
2. Finance
3. Government
4. Law firms
5. Media and entertainment
6. Coworking/real estate
7. Life sciences
8. Health
9. Accounting and consulting
10. Other professional services
I hope this information is useful. Please get in touch with any further questions and we will be delighted to provide a response. Thank you for choosing Wonder!