Renewal vs. relocation: trends in lease lengths in major U.S. office-using industries

Over a 12-month span from Q3 2023 to Q2 2024, the length of lease terms for office buildings in the U.S. averaged 75 months for new leases/relocations and 64 months for renewals. The influence of sublease space and the growing demand for flexibility has led to term lengths falling below historical averages.
Governments and nonprofits maintain their longstanding preference for the longest term leases across major U.S. office markets. In contrast, tech companies averaged the shortest new lease lengths.
The disparity in average length of lease terms across sectors is attributed to each industry’s unique needs and ability to adapt.
For occupiers, these averages give an inside look into how their peers are reacting to current market trends. It also allows occupiers to see what lease terms they can expect in their industry if they’re signing a new lease or a renewal.

August 30, 2024