Office Leasing Activity | FEB 2021
Historical leasing commentary: February 2021. This article discusses pandemic-era office leasing trends reported for 2020. The figures describe broader market activity and a New York example; they are not Hillsborough County or Tampa-specific statistics.
How the Pandemic Changed Office Leasing Activity
Office leasing commentary published in early 2021 described a market increasingly focused on renewals, shorter commitments, and tenant incentives.
The original article reported that renewals accounted for 70% of the leasing activity covered by its source, compared with 29% before COVID-19. It also noted that approximately 43% of fourth-quarter renewals had terms of five years or less.
Reported Pandemic-Era Leasing Trends
| Measure | Reported Finding | Context |
|---|---|---|
| Renewal Share of Leasing Activity | 70% in 2020 versus 29% before COVID-19 | The original summary did not identify the full sample or geographic coverage. |
| Renewal Lease Terms | Approximately 43% were five years or shorter | Reported for fourth-quarter renewals discussed in the original article. |
| 100 Largest Office Leases | 29 million square feet, down 32% year over year | Reported for 2020. |
| Renewals Among the Largest Transactions | 43% | Reported share of the 100 largest office lease transactions in 2020. |
| Business Services Lease Size | Average lease size increased 7% | The original commentary identified business services as an exception to otherwise weaker industry leasing activity. |
| New York Rent Concessions | A reported gap of up to 28% between stated rent levels and rents after discounts and incentives | Third quarter 2020, compared with 6% in 2008. This was a New York example, not a Tampa market measure. |
Renewals and Shorter Commitments
The reported increase in renewals reflected a period when businesses were reassessing their space needs and landlords were working to retain tenants.
Shorter renewal terms could give tenants flexibility while providing landlords with continued occupancy. However, the appropriate lease length depends on the property, tenant, improvement costs, and the owner’s plans.
The two reported 43% figures describe different measures: one concerns the duration of fourth-quarter renewals, while the other concerns renewals among the year’s 100 largest lease transactions.
Asking Rent Versus Effective Rent
The New York example highlighted why stated rent alone does not fully describe a lease transaction. Free rent, improvement allowances, and other incentives can change the economics for both the landlord and tenant.
For property owners evaluating a lease proposal, a useful comparison considers the entire commitment: rental income, concessions, improvement costs, leasing expenses, lease term, and tenant credit.
What Office Owners Can Take From This Historical Period
The original commentary characterized the market as one in which landlords wanted to secure tenants and tenants wanted favorable terms. It also predicted that those conditions would change after the pandemic. That prediction should be understood as an opinion expressed at the time, rather than a current market conclusion.
The lasting practical point is to compare complete lease economics and relevant local transactions. Broad industry statistics and conditions in another city should not substitute for an analysis of a Tampa Bay property’s competitive position.
Source: GlobeSt.com, as credited in John Milsaps’s original February 2021 leasing infographic. The original post did not retain a specific source-article link, full methodology, or complete geographic definitions. Figures are preserved as historical reporting and have not been independently reverified.
Discuss Your Office Leasing Strategy
Own an office or medical office property in Hillsborough, Pinellas, or Pasco County? Contact John Milsaps to discuss your leasing strategy, renewal decisions, or plans to sell.