Philly office prices down more than 50%: report

The value of Philadelphia-area office space sold, in the 12 months ended Sept. 30, plunged to an average $87 a square foot, down more than 50% from the average $176/ft a year earlier, reports LoopNet, the San Francisco (corrected)-based real estate data service.

That's despite a recovery in the total value of office buildings sold, to $265 million, from $197 million a year earlier. That means the space that made it to closing doubled, compared to a year earlier, when you factor in today's lower prices.

Center City Philadelphia accounted for the entire increase, as Brandywine Realty Trust and other landlords bought a string of buildings at discount prices averaging just $80 a square foot, compared to $120+ a year earlier. Suburban sales, by contrast, remained slow, at prices in the $120s, down from the $180s a year earlier, LoopNet says.

Office prices are often the last to recover in a real estate recession. They're also the most important, because, in a service economy, office space = jobs. By comparison, local retail and apartment prices were down 20% from a year earlier, and warehouse/industrial space was off 10%, according to LoopNet.