Suburban Maryland Office Market
|Average Asking Rent (Price/SF)|| $28.68|
|Vacancy Rate (%)|| 14.4%|
|Net Absortion (SF)|| -23,648|
Suburban Maryland’s office demand continued to soften during the second quarter of 2020 with negative 23,648 square feet of quarterly absorption, bringing year-to-date net absorption to negative 195,051 square feet. Likely a result of disruption related to COVID-19, market activity was modest, with limited leasing activity and few notable tenant moves. The overall vacancy rate registered 14.4% at the end of the second quarter, unchanged from the previous quarter but down 80 basis points from a year ago. Asking rental rates ended the second quarter of 2020 at $28.68/SF, an increase of 2.4% from $28.00/SF in the second quarter of 2019. While it may seem counterintuitive that asking rents increased despite negative demand for space, market forces often take a while to adjust, and it is likely effective rents will be flat to declining over the next year as owners increase concessions to lure tenants in an environment of tepid demand.