Q4 2023: Washington DC Office Market Report
The Washington DC area continues to experience slow transaction velocity, despite the 136.38 million square feet of inventory concentrated in the area. The fourth quarter had just over one million square feet transacted, marking the slowest quarter of 2023 and approximately 15 percent lower than the historical average. With tenants downsizing and the trend of flight-to-quality, the average lease size contracted to 5,400 square feet, significantly lower than the historical average. On the plus-side, construction has decreased to 1.1 million square feet, slowing down the influx of new supply and helping demand throughout the market tighten.
Availability is nearing 20 percent, the highest it has been in DC region in the last 20 years, and above the national average. While the overall sublet availability fell throughout the fourth quarter, the East End and CBD submarkets still notched increases. The slow return to office by the federal government and the persistent work-from-home environment continues to negatively impact the office market.
Availability is nearing 20 percent, the highest it has been in DC region in the last 20 years, and above the national average. While the overall sublet availability fell throughout the fourth quarter, the East End and CBD submarkets still notched increases. The slow return to office by the federal government and the persistent work-from-home environment continues to negatively impact the office market.