Pittsburgh's Oakland and East End submarket, the university talent pool that's drawn in companies such as Google, Duolingo and many others, has generated higher office rent growth than any other submarket in the country.
That somewhat wonky designation comes courtesy of CBRE's new Tech 30 report, an annual research study of America's technology industry and its growing importance to the office real estate market, measuring metros across the country for tech company growth and how it's stoking space demand.
According to CBRE, the East End and Oakland generated 34.6% office rent growth between the second quarter of 2019 and the second quarter of 2021, a higher rent trajectory than the Lake Union submarket in Seattle with Pittsburgh's university neighborhoods also ranking among the top five in the country for office space leasing in same two-year period.
The submarket designation focuses on the university districts in cities throughout the country out of which new tech companies typically launch.
Pittsburgh, often a lower rent office market to begin with compared to other metros, partially benefited from a host of new construction projects in Oakland and the East End and the higher rents that go with them.
For years, Oakland and the East End have had very little office vacancy in neighborhoods that traditionally don't offer much space in which to build new office product. That's especially true in Oakland where Carnegie Mellon University, the University of Pittsburgh and UPMC continue to grow while helping to spin off new companies that are emerging into the kind of tech companies helping to spur Pittsburgh's various rankings on the Tech 30 list of CBRE.
Jeremy Kronman, vice chairman for CBRE in Pittsburgh, representing such East End office projects as Bakery Square and Liberty East, said in a prepared statement: “We are continuing to see university sector/tech demand increase as our regional companies work to hire and compete on a global playing field. We are extremely fortunate in Pittsburgh to have the world class institutions of CMU and University of Pittsburgh/UPMC generating the incredible scale and diversity of corporation investment in the region."
