Q1 2021 Baltimore Market Report

Baltimore office market fundamentals continue to show signs of shock in the first quarter of 2021, though signs of rebounding have begun to show. Leasing activity began to show signs of rebounding, though still showing the soft market as activity was 21% below year-ago levels. The first-quarter vacancy continued to rise, ending at 14.9%, a 120-basis point (bps) increase from year-ago levels. Occupancy losses were recorded at -333,317 SF in the first quarter, continuing the second-consecutive quarter of lowest growth seen since 2014. Average office asking rents recorded at $24.93, a $0.39/SF increase from year-ago levels. Asking rents continue to be relatively insulated from pandemic-influenced changes as rates continue to show relatively flat growth, different than the continued swings in Baltimore vacancy and net absorption. Though pandemic-induced uncertainty continues to affect office market fundamentals, optimism surrounding vaccine distribution in the remainder of the year is expected to increase overall market activity.