Office leasing activity remains low as tech sector correction and hybrid work continues

In Q2 2024, the total availability rate in the Silicon Valley office market increased by another 110 basis points (bps) from last quarter to 28.7%. As large technology companies have decided to cut their occupied space and return to office rates have lagged the national average, office space demand remains low. Looking into the second half of the year, it appears that the Federal Reserve will be keeping interest rates higher for longer which will be a headwind for businesses already dealing with higher costs, as well as the technology sector where venture capital funding is expected to remain low.

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