The suburban office park has been taking a beating lately, by both CRE experts and the media, who claim that this mid-20th-century phenomenon is dying, just like shopping malls. Sure, office campuses have been struggling as these days, Millennials, baby boomers and everybody in between tend to flock to urban areas, but the suburban office park is far from dead. Instead, it's being rethought and revamped to include mixed-use development, lots of amenities, and large indoor and outdoor collaborative spaces—with companies like Apple, Facebook, Nike and Google leading the way.
According to Colliers International, as of the closing of the fourth quarter in 2014, asking rents at class-A suburban office parks generally lagged their class-A urban office counterparts by roughly $15 PSF to $20 PSF. For instance, while San Francisco came in No. 3 in the 10 cities with highest office rents, with an average asking price of $62.00 per sq. ft. (PSF), the San Francisco peninsula came in at No. 1, with an average rent of $47.40 PSF, according to Colliers. And Washington, D.C., urban office rents averaged $54.43 PSF, coming in at no. 4 in the cities with highest rents, while the average was only $31.88 PSF in the Capitol's suburbs, which ranked No. 9 on the highest suburban rents list.