Q3 2021 Omaha Office Market Report

Though slow-moving compared to other major U.S. metros, Omaha’s office market is showing early signs of a recovery thanks to its diversified employment base. Leasing volume achieved a post-pandemic high in 21Q3, in line with pre-pandemic norms, and net absorption was positive for consecutive quarters for the first time since before the pandemic. Additionally, Omaha’s overall vacancy rate contracted slightly quarter over quarter in 21Q3 after rising each quarter since the onset of the pandemic. In turn, year-over-year market rent growth reached its highest point since 20Q2.

However, Omaha’s office sector still has a long way to go before it reaches pre-pandemic performance levels. The market’s vacancy rate of 9.2% in 21Q3 remains more than 300 basis points higher than the average witnessed from 2017 to 2019. Additionally, the amount of sublet space has risen each quarter since the onset of the pandemic, posting a new all-time high in 21Q3. Furthermore, Omaha’s office market is contending with a glut of newly vacated space and a still-robust supply pipeline, all in the face of slowing economic momentum stemming from the Delta variant. These trends, combined with the looming prospect of firms exploring more permanent remote and flexible work setups, may continue to place upward pressure on the metro’s office vacancy rate in the near term.