District of Columbia Office Market
|Average Asking Rent (Price/SF)|| $57.49|
|Vacancy Rate (%)|| 15.3%|
|Net Absorption (SF)|| -311,036|
The District of Columbia’s office market continued to weaken in the fourth quarter under the persistent pressure of the pandemic. Market activity was considerably below average in the fourth quarter, as many tenants remained paused in their search for office space. Limited demand over the last nine months has contributed to occupancy losses and increasing vacancy. The District of Columbia did not deliver any office buildings in the fourth quarter; however, the pipeline of deliveries in 2021 is likely to put upward pressure on vacancy rates as some buildings deliver with large blocks of unoccupied space. Net absorption registered -311,036 square feet during the fourth quarter of 2020. Vacancy continues to rise steadily, reaching 15.3% in the fourth quarter, a 30-basis-point increase from the third quarter and a 120-basis-point increase from last year. Asking rents rose in the fourth quarter to $57.49/SF, which nearly offset the 15-cent rent reduction experienced in the third quarter.