Dive Brief:
- Swedish-based Skanska AB, one of the world's largest construction companies, is planning to expand its U.S. property development business in response to an increased demand for office space, according to Mats Johansson, head of the Skanska U.S. commercial development unit.
- A technology boom has fueled demand for office space in Los Angeles and San Francisco, but Johansson said the company is also considering new developments in Miami, Denver and Dallas.
- Demand for U.S. office space, according to Reis, has been powered by low unemployment and is at its highest levels since the recession, with leased space expected to rise by approximately 47 million square feet this year — 48% more than in 2014.
Dive Insight:
Skanska first entered the U.S. commercial office market in 2009, soon after the financial crisis, with its first project in Washington, DC, and it plans to start new projects in Washington and Boston before the end of the year.
Reis forecasts a 3.6% rise in rents and low vacancies in 2016, making it more difficult for Skanska to find available land at reasonable prices. However, according to Johansson, the company will still decide within the next few years which new U.S. markets it will enter.
"Some of the fantastic projects we did in the beginning will be hard to repeat," Johansson said during an interview. "It’s not impossible in any way. It’s just more difficult."
