Q2 2023 Washington DC Office Market Report

The Washington DC office market is continuing to see heightened vacancy, availability, and negative net absorption. Sublease space is rapidly growing, ending the quarter at nearly 11.8 million square feet. Approximately four million square feet of this is concentrated in the downtown DC area. A large part of the rise in vacancy rates comes because of the federal government condensing their office spaces, coupled with a lack of return-to-office policies from the government sector.

Trophy and Class A products continue to have stronger momentum, as amenities and desirable workspaces have become a priority for tenants trying to provide a space that will attract employees to return to the office. Development has slowed throughout the year, specifically as Amazon put a halt on their phase two construction after completing their initial phase.