Q2 2020 Baltimore Market Report
Baltimore’s office market expansion slowed in Q2, largely due to the coronavirus. Occupancy in the region fell by 235,141 SF on the quarter, however much of that contraction was clustered in the Columbia South and BWI/Anne Arundel markets. While occupancy in other markets were closer to net-neutral, regional leasing activity (a leading indicator of occupancy expansion) completely dried up. Market softening should be expected as low demand and economic uncertainty puts pressure on vacancy rates. While market fundamentals indicate that demand is waning, asking rents have been on the rise in the majority of Baltimore’s submarkets. Despite the coronavirus’ negative impact on business activities, landlords appear optimistic that underlying demand is strong. The duration and scope of the coronavirus will dictate Baltimore’s recovery timeline, however the stability of its office market prior to COVID has provided some insulation against the severity of the initial market shock.