Cincinnati JLL Office Employment Update February 2015
Cincinnati office insight q2 2015
1. Office construction heating up (s.f.)
Source: JLL Research
Blue Ash/Montgomery net absorption (s.f.)
Source: JLL Research
Class A and Class B rental rates
Source: JLL Research
Rising demand continues to fuel office construction
Rising demand across the Cincinnati office market has sparked a number of new
developments, increasing the level of office product under construction to its
highest level in years. The development pipeline is also active, with numerous
projects lined up in the queue. The largest project awaiting construction kick-off
is 180 Walnut at the Banks, a potential 10-story, 235,000-square-foot speculative
office tower. Carter, the site’s master developer, is still looking for an anchor
tenant to begin construction.
Blue Ash/Montgomery enjoys aggressive leasing rebound
The Blue Ash/Montgomery submarket has experienced a surge in leasing
activity through the first half of 2015 following a trend of declining demand seen
in the years prior. A number of significant lease transactions were signed
recently, including Kroger’s takedown of the entire five-story, 176,000-square-
foot office building at The Landings of Blue Ash, a former CitiBank facility.
Microsoft also recently announced a significant commitment to the submarket,
leasing roughly 17,000 square feet at Lake Forest Place, a seven-story, Class A
property located at 4445 Lake Forest Drive. These along with other significant
transactions are expected to add numerous jobs in the area, further cementing
the Blue Ash/Montgomery submarket’s status as a suburban hotspot.
Rental rates on the rise across Class A and B properties
Asking rents have slowly been on the rise as both Class A and B assets
recorded measured growth in rates over the past year. The average Class A
asking rent currently sits at $21.87, an increase of 2.6 percent, or $0.56, year-
over-year. Meanwhile, Class B asking rents posted an annual gain 2.7 percent,
or $0.42, from $15.42 to $15.84 per square foot. Looking forward, the trend in
rising rents is expected to hold steady, supported by a continually tightening
market and increasing levels of tenant activity.
Rental rates and tenant demand record gains
2,257
Office Insight
Cincinnati | Q2 2015
34,380,853
Total inventory (s.f.)
-313,918
Q2 2015 net absorption (s.f.)
$19.16
Direct average asking rent
2,024,533
Total under construction (s.f.)
19.4%
Total vacancy
-47,008
YTD net absorption (s.f.)
0.9%
12-month rent growth
53.4%
Total preleased
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
2011 2012 2013 2014 YTD 2015
-100,000
-50,000
0
50,000
100,000
150,000
2011 2012 2013 2014 YTD 2015
$12
$16
$20
$24
2011 2012 2013 2014 Q2 2015
Class A Class B
