by Shane Henson — December 16, 2011—Businesses renting building space in New York City, Washington, DC and San Mateo, California likely pay significantly more than tenants renting in less expensive U.S cities, according to findings provided by the Building Owners and Managers Association (BOMA) International, which has identified the most expensive commercial real estate markets in the United States. According to the organization, the data is drawn from the 2011 Experience Exchange Report (EER), which provides an annual analysis of the office building operating income and expense data compiled across approximately 940 million square feet of commercial office space in more than 6,500 buildings in 278 different markets. The 2011 report is based on operating income and expenses from 2010.
The most expensive U.S. cities and the average price per foot, based on total rental income, are:
- New York, NY, $48.27 per square foot (psf)
- Washington, DC, $42.63 psf
- San Mateo, CA, $41.61 psf
- Santa Monica, CA, $36.67 psf
- San Francisco, CA, $34.86 psf
- Boston, MA, $31.15 psf
- San Jose, CA, $30.35 psf
- Los Angeles, CA, $27.97 psf
- West Palm Beach, FL, $27.71 psf
- Chicago, IL, $25.20 psf
Total rental income includes rental income from office, retail, and other space, which includes storage areas. According to BOMA, amid the economic downturn in real estate markets, few markets demonstrated significant increases in rental income, suggesting that rental rates remain relatively stable and favorable for tenants seeking to pursue new leases or renegotiate existing ones. Among the most expensive cities, only New York and San Francisco showed increases in rental income.
