Rent Incomes, Expenses Rising in U.S. Office Buildings

Sept. 9, 2015

Benchmarking study shows office sector economy gaining strength.

Income levels are growing while expenses also continue to increase in U.S. office buildings, according to the results of a new study released by BOMA International and Kingsley Associates, a research firm. The 2015 Office Experience Exchange Report (Office EER) shows that while office building rental income grew by 5.2% from $27.19 per square foot to $28.63 per square foot, total operating expenses also increased by 6.1%, rising from $7.96 per square foot to $8.45 per square foot in 2014.

With the study’s data demonstrating that the office sector has posted a second straight year of significant income growth, the study’s authors argue that the industry has turned a corner since the Great Recession. The increase in expenses can be attributed to two factors: 1) a large (7.9%) jump in utility expenses over the past year and 2) FMs performing more maintenance and improvement projects that may have been put on hold during the economic downturn, with repairs and maintenance expenses rising by 6.2% from 2013 to 2014.

Additionally, office densification is continuing its rise to prominence with reported square feet per office worker dropping 1.5% in private-sector buildings from 2013 to 2014. Rising worker densities can increase costs and cause increased use and stress to key pieces of building infrastructure such as HVAC systems.

Voice your opinion!

To join the conversation, and become an exclusive member of Buildings, create an account today!

Sponsored Recommendations

Building Better Schools

Download this digital resource to better understand the challenges and opportunities in designing and operating educational facilities for safety, sustainability, and performance...

Tips to Keep Facility Management on Track

How do you plan to fill the knowledge gap as seasoned facility managers retire or leave for new opportunities? Learn about the latest strategies including FM tech innovations ...

The Beauty & Benefits of Biophilic Design in the Built Environment

Biophilic design is a hot trend in design, but what is it and how can building professionals incorporate these strategies for the benefits of occupants? This eHandbook offers ...

The Benefits of Migrating from Analog to DMR Two-Way Radios

Are you still using analog two-way radios? Download this white paper and discover the simple and cost-effective migration path to digital DMR radios that deliver improved audio...