Pittsburgh’s Central Business District (the “CBD”) is the largest office submarket in the Pittsburgh MSA. The CBD boasts more than 27.6M SF, which represents nearly 32% of total market inventory. Since having 500,000+ SF of office space hit the market in a single quarter a year ago (Q2 ’23), the total aggregate net absorption in the CBD in the past year was -260,446 SF; this indicates a pick-up in activity, although negative net absorption continues. Simultaneously, vacancy in Q2 ‘24 in the CBD is the highest its been (15.1%) since Q2 ‘20 and is expected to continue rising despite increasing leasing velocity by more than 10% per quarter since Q3 ’23.
The sole new office construction project in the CBD, FNB Financial Center, is experiencing a successful lease-up campaign following FNB’s commitment to taking 60,000+ more SF in the tower. The commitment bringing FNB’s total footprint to 230,000 SF in the 460,000 SF tower, which brings the project to 70% pre-leased; the project should be completed in October of 2024. FNB’s expanded presence in what will soon be the CBD’s newest tower (and the highest-priced office building in the submarket) is a bright spot in an otherwise challenging office market.
