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DC Office Leasing Rises in Q1, Demand Remains Weak
The Washington D.C. office market experienced an uptick in leasing activity in Q1 2024, with 1.7 million square feet leased, compared to 1.3 million square feet in the previous quarter, Savills reported. The Technology, Advertising, Media, Information (TAMI), Government, and Legal sectors were the dominant players in this quarter’s leasing activity.
The largest lease was by The Washington Post, which renewed 297,176 square feet at 1301 K Street NW. However, despite the increase in leasing activity, overall volume remains below the five-year average, and availability is at a historic high.
The market continues to be bifurcated between trophy and non-trophy buildings, with tenant flight-to-quality driving demand for premier properties. Availability rates for trophy buildings have remained below 17.0% for the past year, with asking rents remaining stable. Sublease space continues to weigh on the market, with available sublease space reaching a new high at 3.6 million square feet. Overall, the office market is adjusting to new patterns of in-office and hybrid work, with occupiers seeking competitive office spaces with the best amenities.
- ◦Lease
