Photographer: Bradley C. Bower/Bloomberg

The City of Brotherly Love is finally getting some affection from commercial real estate investors.

Philadelphia, where office properties last year attracted about half the investment of Washington and less than a 10th of Manhattans total, is seeing a boom in demand that has sent the average price per square foot to a record. Office sales in the first half of this year more than doubled to $1.4 billion, the highest since close to the markets peak in 2006, according to New York-based research firm Real Capital Analytics Inc.

Real estate values approaching or surpassing peak levels in New York, Boston and Washington have buyers turning to Philadelphia for its higher yields, rising rents and falling vacancies. Thats bolstering office deals in the fifth-largest U.S. city at a time when Manhattan-like towers have opened with luxury condominiums and cable operator Comcast Corp. is developing a skyscraper that will be the areas tallest.

We view Philadelphia as really on the upswing, said Gerard Sweeney, chief executive officer of Brandywine Realty Trust (BDN), which owns 13 properties in the citys main business district, including one under development. Theres certainly an expectation that rents will continue to move up.

The average capitalization rate -- a measure of yield that moves inversely to price -- for a Philadelphia office building was 7.5 percent in the second quarter, according to data compiled by Real Capital. While thats down from a high of 8.9 percent two years earlier, its more than the averages of 4.6 percent in Manhattan, 6.1 percent in Washington and 6.5 percent in Boston, the data show.

The average price per square foot of a Philadelphia office building reached $283 in the first quarter, the highest in Real Capital records dating to 2001.

Philadelphia has long been overshadowed by its big-city East Coast neighbors to the north and south. Institutional investors such as sovereign-wealth funds gravitate to the perceived safety of New York or Washington, where rents frequently climb faster and values rebounded first in the recovery.

Unlike New York, with its heavy concentration of financial, media and technology tenants, and Washington, with its work force tied to the federal government, Philadelphia doesnt have a single large office-tenant base. Government, universities and hospitals are among the biggest employers in Philadelphia County, according to the Pennsylvania Department of Labor & Industry.

The largest public companies by market value with headquarters in the city are Comcast; oil pipeline operator Sunoco Logistics Partners LP; and FMC Corp., a research company in the chemical industry, according to data compiled by Bloomberg.

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This is Medical Missions rendering of the hotel, part of proposed new $150 million complex that would include office building approved Wednesday night.

PATERSON The city planning board has given its approval to the construction of a seven-story office building and medical school on Main Street near St. Josephs Regional Medical Center.

The office complex is being built by Morristown-based Hampshire Partners in conjunction with the Medical Missions For Childrens 14-story hotel and conference center across the street.

Local officials have hailed the two projects, with a combined cost of about $150 million, as a much-needed boost to Patersons economy, predicting that it will not only generate additional tax revenue for the city but that it also will spur other development.

The proposed hotel had been on the drawing board for more than four years before it received planning board approval this past summer. Medical Missions had been struggling to secure the financing and was unable to convince city or county officials to guarantee loans for the project.

But last year, the New Jersey Economic Development Authority approved $105 million in transit hub tax credits for the hotel and office building, allowing the plans to move ahead.

The planning board approved the office building Wednesday night. Its not clear when the Hampshire Group plans to start construction. Hampshires Kim Stirba-Reynolds did not respond to a phone call seeking her comment.

The planning application says the building will have 110,000 square feet and 29 off-street parking spaces. Another 81 spaces will be available for the office building at St. Josephs parking facilities, according to the application.

Medical Missions, a city-based nonprofit group, had said it would hold a ground-breaking in October. That has not happened yet, but a representative of the organization said work would start before the end of the year.

Mayor Jose Joey Torres could not be reached for comment.

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A south Manchester office building has been bought for more than 4m.

Property Alliance Group, the Trafford Park-based investor and developer, has acquired Roberts House from Selbourne Group.

The building, at 80 Manchester Road, is a high quality refurbished office building and is fully let, with tenants including The Employment Service and Meridian Business Services.

Alex Russell, of Property Alliance Group, said: "Roberts House came available at an opportune time for us and fits in with our business plan to expand the portfolio with well located buildings that have good asset management potential. We are well funded and actively pursuing growth opportunities in all sectors."

Michael De Massey, of Selbourne Group, added: The sale demonstrates the strength of south Manchesters commercial office market, the area remains a popular business centre for national and regional organisations.

Hill Dickinsons Manchester property and construction team completed the sale of the office building on behalf of its long-standing client Selbourne Group.

Partner Jonathan Dover said: Having worked with Selbourne Group since acquiring Roberts House and in 1999 further advising them on their asset until its recent sale, we understand the clients requirements. We are delighted to have worked with them on this successful transaction.

Squires Patton Boggs advised Property Alliance Group.

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Houston and Dallas have been the top office construction markets so far in 2014, according to a new report.

In the first nine months of this year, Houston had office building completions totaling almost 3 million square feet. In the Dallas area, builders finished about 1.9 million square feet of space, according to the report by commercial real estate firm Cushman & Wakefield Inc.

Its the first time since the 1980s boom that the two big Texas markets have so dominated the office building market.

At the end of the third quarter, 5.4 million square feet of office space was still under construction in the Dallas-Fort Worth area. Thats up from only about 1.1 million square feet in third quarter 2013.

The economic recovery and a rapidly evolving workforce have pushed the office market into a positive trajectory that has held steady through the first nine months of the year, said Cushman & Wakefields head of research, Maria T. Sicola. Corporate America is actively expanding and working to position itself for the millennial workforce, which by 2020 is expected to make up more than half of the labor pool.

Cushman & Wakefield said the nationwide downtown office vacancy rate fell to 12.6 percent at the end of the third quarter, the lowest level since early 2009.

Downtown Dallas office vacancy in September was about twice that rate.

Nationwide suburban office vacancies were at 16.6 percent, compared with 18.6 percent in the D-FW area.

Cushman & Wakefield said net office leasing in the country is expected to reach its highest level since 2007, with 31.9 million square feet in occupancy gains year to date. That compares to 14.9 million square feet last year at this time.

The absorption levels both central business districts and suburban are dramatic, Sicola said. In the non-CBD markets, growth was spurred by occupancy gains in suburban Dallas, Houston, Los Angeles Metro and San Francisco.

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Almost overnight, it seems, developers are stepping forward with bold proposals for big, new office projects in or near Downtown.

Alco Parking President Merrill Stabile announced a plan Oct. 8 to build two 11-story office towers and a 1,227-space parking garage in a lot he owns behind PNC Park.

The next day, Raleigh, N.C.-based Highwoods Properties unveiled a proposal to erect a six-story glass office building on the Monongahela riverfront at SouthSide Works as part of a four-building deal with the Soffer Organization.

And in August, Oxford Development Co. pitched a plan for its Smithfield Street property a 20-story office high-rise that its billing as the most efficient in the city.

Why the flurry of proposals?

Its all about the office market in and near Downtown, local real estate experts say. Its very tight, with top-of-the-line Class A office space tough to find. Developers are hoping to capitalize on the shortage.

Probably whats driving it is the strength of the market. I would think developers would want to take advantage of that if theyre in control of viable sites, said Jon Harrigan, CEO of Pennsylvania Commercial Real Estate Inc., Downtown.

It doesnt hurt to test the waters, he added.

If I were in their situation, I would be doing the same thing. You want to make sure your oar is in the water in case theres an anchor tenant searching for a new home, he said.

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Yellow Quill First Nation announced Wednesday it will be constructing a commercial office building in downtown Saskatoon.

SASKATOON Its been a parking lot for years but on Wednesday a Saskatchewan First Nation announced its commitment to constructing a $40-million commercial office complex in downtown Saskatoon.

Yellow Quill intends to build a class A architecturally-inspired office building to the highest environmental and efficiency standards, said Tom McClocklin, Colliers International Saskatchewan president/managing director.

Its been a four-year process but Yellow Quill has secured reserve status for the property and is looking to secure additional tenant leasing commitments before starting construction.

The First Nation Bank of Canada has already signed on.

We are standing officially on Yellow Quill First Nations land here in the city of Saskatoon. The first in downtown Saskatoon and the first to take lead in the developments downtown, said Chief Larry Cachene, Yellow Quill First Nation.

Federation of Saskatchewan Indian Nations (FSIN) Chief Perry Bellegarde applauded the announcement Thursday and conveyed his support of the new urban reserve.

This is a perfect example of First Nations peoples taking control of their economic destiny, said Bellegarde.

By sharing proven methods of development success we, as First Nations peoples, travel a path of greater economic sustainability. And as we do that, we position ourselves for greater self-determination,

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First Nation to build on urban reserve in downtown Saskatoon

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Beacon Partners said Tuesday that it will break ground on a five-story mixed-use office building in South End, hoping to attract companies drawing from the areas young talent pool of workers.

The new building at 1616 Camden Road, dubbed the 1616 Center, will house 10,000 square feet of retail space on the first floor with 65,000 square feet of office space on the four floors above.

Demolition of two existing buildings at the site will begin this week, with construction on the new building likely starting next week, said Mike Harrell, who oversees Beacons office development and acquisitions program. The site sits next to Prices Chicken Coop.

Harrell hopes the building taps into the areas demographics, attracting technology companies, engineering firms and other would-be tenants with a young adult workforce.

We just like the area ... and see a lot of companies wanting to move (there) to take advantage of all the young people moving to the area, he said.

Plans call for 1616 Center to open by third quarter next year when it will be part of the planned Rail Trail, a 3-mile public park connecting several Charlotte neighborhoods.

The steel building fits with the areas industrial history, said David Furman of Centro Cityworks, the architectural firm that designed the center. It will house a visitors center, public meeting areas, wide sidewalks and artwork in the lobby.

Camden Road, Furman said, is emerging as the downtown of South End. In designing 1616 Center, he envisioned creating an urban office building for tenants with contemporary workers.

One such tenant is Adam Boatsman, founding partner of the Boatsman Gillmore Wagner accounting firm in SouthPark. The first tenant of 1616 Center, he signed a 12,000-square-foot lease.

We hire five to seven brand new college grads every year, and where do they want to live? he said. They want to live (near) uptown.

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Central-city office building wins top award DAVID KILLICK

JOHN KIRK-ANDERSON/ Fairfax NZ

AWARD WINNER: The Stranges building in Lichfield St has be lauded for mixing new design while referencing its architectural past.

A new office building capturing elements of its historic predecessor has won the supreme award in this year's Christchurch Civic Trust Awards.

The Stranges building, on the corner of Lichfield and High streets, was designed by architect Jasper van der Lingen, of Sheppard and Rout, and replaces a historic building that occupied the site from 1899 until the Canterbury earthquakes.

Read more: Architecture awards celebrate city's urban renewal

The Civic Trust said the design "acknowledges the original character of a major corner site and gives consideration [to] inner city urban revitalisation".

"While construction utilises 21st century design in terms of its structure and the use of materials, it also makes strong and meaningful references to its architectural past," it said.

The building was among the first to be completed in the inner city's former earthquake red zone.

Trust chairman Neil Roberts said the trust, which has been in existence for nearly 50 years, was "shifting its focus slightly away from the heritage architecture emphasis it has had in the past".

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Stranges building wins supreme award