King of Prussia District Q2 2024 Commercial Report Points to Growth

King of Prussia, PA (July 31, 2024) – King of Prussia District’s Q2 2024 Commercial Report, released today, signals that suburban Philadelphia’s largest employment center continues to grow and occupancy rates remain high. The report analyzes key indicators of Upper Merion/King of Prussia’s (UMT/KOP) performance, including occupancy of commercial office, industrial, retail, medical and life science spaces, as well as employment and residential population trends.

According to data from CoStar, UMT/KOP’s available vacant Class A office space (4.4M SF) increased slightly by 1.9 points to 9.9%, however it remains far below the highest vacancy back in 2019 (18.2%). Class B office (2M SF) continued to perform well, with a 1.2-point decrease to 11.6%. Class C office (263K SF) vacancy increased by half a point to 9.8%. When all office classes are combined, the vacancy rate of available office space in Q2 2024 is 10.5%, representing a 6.3-point decrease compared to Q2 2013 at 16.8%.

Industrial properties (6.5M SF) remained strong in Q2 2024, with a one-point decrease in the vacancy rate to 2%. Flex and retail space remained steady, with flex properties at 4% vacancy, and retail properties (5.9M) at 2.8% vacancy.

Demand for Medical properties (492K SF) in UMT/KOP continues, with an 11.1% vacancy rate across 17 properties. The vacancy rate dramatically decreased from 21.0% in 2019, reaching the lowest rate of 7.8% at the beginning of 2023. Life Science remains a significant economic driver for UMT/KOP, with 2.5M total SF across 19 properties. It has hit the lowest vacancy rate of 4.3% in the past five years, marking a substantial decrease of 32.2 points compared to the highest vacancy rate of 36.7% in 2019.

The strong performance of UMT/KOP’s commercial and industrial properties is not the only marker that shows that Montgomery County’s economic engine continues to grow. An analysis of Placer.ai’s mobile phone data indicates that 78.4K employees work in UMT/KOP in 2023, marking an 11.8% increase compared to the pre-pandemic period in 2019. Employee visitation shows that weekend retail and entertainment markets remain strong, almost returning to 2019 visitation numbers. The hybrid working model remains the preference among Monday to Friday employees.

Upper Merion, which was just named as the 2^nd best place to live for families in the United States by Fortune magazine, is also experiencing a rise in its residential population. According to American Community Survey Census data, the residential population in UMT/KOP grew from 30.3K in 2019 to 33.7K in 2022, marking an 11.2% increase.

“From David’s Bridal to Netflix House, to Trader Joes – Upper Merion continues to be a top choice for headquarters, attractions, retailers and restaurants,” said Eric Goldstein, President & CEO of King of Prussia District. “Businesses select King of Prussia for many of the same factors that residents and employees do – access to new housing, diverse dining and shopping, world-class healthcare and a thriving community.”

Read King of Prussia District’s Q2 2024 Commercial Report here.

ABOUT KING OF PRUSSIA DISTRICT

King of Prussia District was founded through an Upper Merion Township Ordinance in 2010 as a not-for-profit, 501(c)3, business improvement district to serve as a catalyst for economic development and job growth. Within its 1,935-acre boundary, King of Prussia District partners with 431 commercial, industrial and multi-family property owners who collectively have over $2.3B in total assessed property value.

King of Prussia District’s mission is to accelerate growth by making King of Prussia vibrant, attractive and prosperous. This mission, and our core values – progressive, determined and fun – drive the organization’s work across five programs: Land Use & Zoning; Marketing & Communications; Physical Improvements; Research & Data Analytics; and Transportation.

More information is available at visitKOP.com | Facebook @KingofPrussiaDistrict | Instagram @visitKOP | LinkedIn @KingofPrussiaDistrict | Twitter @KOPBID