In recent conversations with tenants and landlords across the Philadelphia region, we are seeing a similar trend. According to CoStar Analytics, industrial sublease space now represents about 7.9 percent of all available industrial inventory, a multi decade high. Of the roughly 65.5 million square feet currently available, approximately 5.2 million square feet is being offered for sublease.

Much of this stems from the industrial leasing surge in 2021, when companies rushed to secure warehouse space amid supply chain disruptions and strong e commerce demand. Many tenants leased more space than they ultimately needed.

As conditions normalize, some companies are now marketing excess space for sublease. Much of the current sublease inventory is under 250,000 square feet, suggesting smaller operators are driving much of the pullback.

While rising sublease space can create opportunities for tenants to secure discounted rents, it may also add competition for landlords in certain submarkets. Overall, the trend appears to reflect a market recalibrating after several years of unusually strong industrial leasing.

M.S. Fox Real Estate Group is currently marketing a 10,573 square foot flex sublease opportunity in Norristown, Pennsylvania, which is a good example of the type of versatile industrial space that is beginning to appear in the market

Source: CoStar Analytics, March 2026.

Why?

1. Often times Tenants advertise space available as a Sublease, however that space is occupied and not available unless the Tenant secures a subtenant willing to pay the same rent the Tenant is paying to the Landlord and  the underlying Tenant secures replacement space satisfactory to the Tenant. You can imagine the waste of time getting involved with a transaction with those unknowns.
2. Tenants can be in default of their lease as a result of non- payment of rent. Landlords will not provide consent to a Subtenant under this scenario.
3. The Tenant is not financially strong enough to pay the Landlord the delta cost in the event he accepts your below market offer.
4. The Lease has termination rights that are not disclosed in the advertised offering. One could begin negotiations on a 4 year sublease term, and find out the Tenant has a termination right 2 years into your 4 year sublease.
5. The Sublease term being offered has less than a year left on the term.

What should you do?

Hire a broker that understands how to find and negotiate a below market deal. Call Mike Fox at 215-568-8000

Cities and their mayors are starting to be more environmentally conscious; amongst this trend is The City of Philadelphia with the support of Mayor Jim Kenney. This commitment to renewable energy sources is especially notable as it emerges in the midst of the White House’s action to withdraw from the Paris Climate Agreement.

The City of Philadelphia has announced, with the guidance of Mayor Kenney, a pledge to convert to 100 percent renewable energy by 2035. Philadelphia joins major cities such as New York, Chicago, & Los Angeles in moving forward to fight climate change. A majority share of the carbon pollution in the city comes from buildings and industry. This would be a great opportunity for businesses to show their corporate social responsibility, by looking into ways that their office spaces could reduce the amount of energy used or transition over to a clean energy source.

The opportunity is now for buildings to buy into the clean energy movement. Renewable Energy has normally been seen as expensive to install and not cost effective to operate. The script has flipped, prices of renewable energy technologies is falling rapidly, making the transition actually less expensive and more attractive. Solar, wind, and hydro power has surfaced as a cost-competitive and viable alternative. At this point in time it would make sense for building owners to look into the transition in order not to be left behind in the new wave of energy use.

Romero, M. (2017, June 21). Philly commits to 100 percent renewable energy plan. Retrieved June 28, 2017, from https://philly.curbed.com/2017/6/21/15846138/paris-agreement-philadelphia-climate-change-renewable-energy-clean-power

The ground floor space at 417 N 8th street, once occupied by shampoo nightclub, is under construction to be converted into 13,500sf of creative office space. Ownership is also investing in other capital improvement including new lobby renovations and improvement to the exterior entrance of the building. This particular space is a bi level suite with it own private entrance. The open floor plan will showcase the buildings architecturally unique features. Some of these features include:

• 13,527 SF Available For Lease
• Self Contained Bi-Level Suite
• Private Glass Entrance
• Prominent Exposure & Presence
• On-Site Parking
• New Windows with Abundant Light
• Exposed Brick, Timber Columns & Ceiling
• New Lobby with Eco-Plant Wall
• Bike & Pet Friendly
• $20.00 Square Foot

For Lease Inquires : Please Contact

Tony Falcone or Brett Fox at 215-568-8000

23,000 SF medical treatment facility on Kensington Avenue

9,772 SF New River Health & Wellness Lease at 1 Brown Street, Philadelphia

4,800 SF Dental Solutions lease at Central Square Shopping Center in NorthEast Philadelphia

5,151 SF renewal and expansion – Nutche Chiropractic at 1608 Walnut Street

First Transaction, the Tenant, Y2K9, leased +/-15,000 square feet for a 10 year term at 601 Davisville Rd. Willow Grove, PA. Y2K9 is a dog training organization that offers a wide curriculum of training classes; including obedience, agility, and freestyle dance. Michael Fox of M.S. Fox Real Estate Group represented the Tenant. Arlington Group represented the Landlord, Premier Office Solutions.

Second Transaction, the Tenant, Barry Levin DMD, leased 4,000 square feet for a 13 year term at 509-15 Old York Road Jenkintown, PA. Barry Levin DMD is a periodontist who specializes in dental implants. Michael Fox and Brett Fox represented the Tenant Barry Levin DMD. Abrams Real Estate and Development represented the Owner.

 Third Transaction, the Tenant, New River Health & Wellness, signed a 10 year lease for 9,722 SF on the ground floor of The Penthouses at 1 Brown Street Philadelphia, PA. New River Health & Wellness is a medical complex dedicated to rehabilitation and fitness. Karl Schwemlein of M.S. Fox Real Estate Group represented the Tenant.

Fourth Transaction, the Tenant, Crossfit Rittenhouse, leased +/- 5,000 square feet for a 7 year term at 2300 Chestnut Street Philadelphia, PA. Cossfit Rittenhouse is Philadelphia’s elite fitness center, offering custom designed training to meet the individual goals of their members. Brett Fox of M.S. Fox Real Estate Group represented the Tenant.