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Market Report

Pittsburgh Office Market Report

2023 Investment Forecast

Metro Retains Stable Demand Drivers, Despite Headwinds;
Tepid Supply Gains Confined to Core

Demand softens overall, though market is not without silver linings. While leasing activity entered this year well above the 2020 nadir, signings have retreated after an improvement in 2021 as macroeconomic concerns are discouraging firms from expanding. With a fourth consecutive year of negative net absorption expected in 2023, availability is unlikely to return to the pre-pandemic level during the near- to mid-term. On a more positive note, supply gains will sharply decelerate through at least 2025, with an active pipeline of just over 700,000 square feet constituting roughly 0.5 percent of overall inventory. Nearly all space underway is located in the city of Pittsburgh or first-ring suburbs, indicating minimal impacts on outlying submarkets for the foreseeable future. Leasing in the core and adjacent zones will be underpinned by a robust financial services sector, with First National Bank and New York Life highlighting 2023 move-ins. Carnegie Mellon and the University of Pittsburgh also continue to foster academic partnerships in the Oakland submarket, facilitating a stable demand base here. Due in part to the area’s robust medical sector, this zone was the single Allegheny County locale reporting vacancy in the single digits as of late 2022.
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