Tenant war intensifies in São Paulo’s office market

In the first quarter of 2025, law firm TozziniFreire Advogados vacated the Borges Lagoa building, located in the Paraíso submarket—a Class B asset fully occupied by the firm, with 6,456 sq m of gross leasable area. The property remains vacant, with market rents in the area estimated at R$54.80 per sq m.

In a clear flight to quality move, the firm relocated to the 11th and 12th floors of Salma Tower, in the Faria Lima submarket, a Class A asset. The new lease totals 2,457 sq m (BOMA), at R$310 per sq m—equivalent to approximately R$761,000 per month.

Among these factors, end-user experience has gained prominence. Companies are seeking environments that go beyond the traditional office function, incorporating elements that foster collaboration, well-being and corporate culture.

“Companies are looking for buildings that offer a more complete experience for their employees, with amenities in the surrounding area, access to public transportation, food options, services and infrastructure,” she says. This trend is directly linked to the challenge of making the return to the office more attractive in a hybrid work context.

In this sense, location is no longer just a geographic attribute—it has come to represent an ecosystem. Hubs with a broader offering of services, mobility and convenience are gaining an edge in attracting large occupiers.

Office design itself has also evolved. “Collaborative environments, high-quality common areas, social spaces and flexible layouts have become important differentiators,” the source explains. The goal now is to accommodate different usage dynamics, from focused work to team interaction.

This transformation also directly impacts landlords’ strategies. Real estate funds and institutional investors are adopting a more active stance, moving away from the traditional model of simply leasing space.

“In this new environment, institutional owners are taking a more active and strategic approach to remain competitive,” she says. This includes everything from physical upgrades to assets to changes in leasing strategies.

One of the clearest examples of this shift is the growing supply of plug-and-play office spaces. “The availability of furnished spaces has emerged as a key solution to meet demand for agility and lower fit-out costs,” she notes. This format reduces occupancy time and eliminates a significant portion of upfront investment for tenants.

On the financial side, flexibility has also become a key component in negotiations. Commercial incentives, rent-free periods, fit-out contributions and tailor-made structures are now common, especially in large-area leases.

“Financial structuring has become a determining factor in the competition for major tenants,” she emphasizes. According to the source, terms aligned with current market conditions are essential to enable strategic occupancies.

These changes point to a deeper transformation in the role of owner. “The owner’s role is evolving from a more passive stance to a proactive approach,” she says. Today, understanding tenant needs and adapting assets accordingly is central to strategy.

Meanwhile, competition among office hubs is expected to intensify. Traditional submarkets continue to attract high-end tenants, but emerging areas are gaining traction by offering more competitive cost-benefit ratios alongside modern assets.

“The trend is for competition among the main corporate hubs to remain strong,” she notes. In this context, the rise of areas such as Rebouças reinforces the idea that the market is in constant reconfiguration.

Ultimately, the battle for major tenants reflects a more dynamic market, where assets, location and strategy must align. Landlords that successfully combine quality, experience and flexibility will be better positioned to capture demand and sustain occupancy over the medium to long term.