Over the past 12 months, rent growth in the Philadelphia metro area has moderated, with growth at 0.8%. Meanwhile, stabilized vacancy has increased 30 basis points over the year to 3.8%. In the city of Philadelphia, absorption has slowed over the year unlike in other major cities in the Mid-Atlantic, such as Baltimore City and the District.
THIRD QUARTER 2023 HIGHLIGHTS
The metro area Class A stabilized vacancy increased 30 basis points from a year ago to 3.8% at third quarter 2023. Southern New Jersey reported the lowest stabilized vacancy at 1.8%.
- Suburban Pennsylvania stabilized vacancy increased by 50 basis points from September 2022 to 3.4%.
- Stabilized vacancy in Southern New Jersey increased 30 basis points from 1.5% last year at this time to 1.8% at September 2023.
- Stabilized vacancy increased by 10 basis points in the City of Philadelphia to 5.3%.
Suburban Pennsylvania led in rent increases over the year. Here are the effective rent changes by sub-area as of September 2023:
- Suburban Pennsylvania up 2.5%
- Southern New Jersey up 2.0%
- City of Philadelphia down-2.4%
Metro-wide, effective rents increased 0.8% over the year ending September 2023. Average metro-wide effective rents at third quarter 2023 are $2,265, or $2.46 per SF. Effective rents average $2,377 ($2.86 per SF) for the City of Philadelphia (primarily in mid- and high-rise product) and $2,207 ($2.25 per SF) for the suburbs (primarily in low- and mid-rise product).
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