National + Office | April 26, 2023

Office Space Demand Shakes Off the Winter Doldrums

Springtime office demand got off to an especially strong start in March following the slower winter months, VTS reported. According to the latest VTS Office Demand Index (VODI), national demand for office space rose 31.3% from February to March, surpassing the month-over-month March growth recorded in pre-pandemic 2018 and 2019.

Nationally, the VODI jumped 15 points to a level of 63 in March, after relatively stable levels in the past few months. Despite its strong performance, the March VODI was still down 4.5% from a year ago. However, the year-over-year gap has narrowed significantly compared to February

“The Fed’s streak of interest rate hikes and a spectrum of severe weather lashing all areas of the country in recent months undoubtedly sidelined office touring activity and leasing decisions for many employers,” said Nick Romito, CEO of VTS. “The sluggish start to the year left us in limbo as to whether we’d see normal levels of spring activity return. Thankfully, the office leasing market had its spring awakening – and then some.”

Pictured: San Francisco, which saw the strongest recovery in new office demand among major markets.

Connect

Inside The Story

VTS

About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types, as well as delving into broader subject matter. He produces 15-20 daily news stories per day and works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications. Since 1999, Paul has volunteered as the newsletter editor of passenger rail advocacy groups (one national, one local).

Order Reprints