District of Columbia Office Real Estate Market Report

District of Columbia Office Market

The District of Columbia experienced 487,840 SF of positive net absorption during Q4 2024. The vacancy rate declined 60 basis points quarter-over-quarter to 19.2% and decreased 50 basis points year-over-year. The sole property under construction in the district is 600 Fifth, a 400,000-square-foot office building in the East End. Overall, asking rents have decreased slightly during 2024 Taking rents of trophy space continue to increase as the overall availability of space in trophy assets, regardless of where it is in the stack, decreases. Asking rents for trophy class have declined slightly. However, this is due to top stack space being occupied, with the remaining vacancies in trophy assets located mainly in the lower stack with lower rents, decreasing the overall average of trophy class asking rents. This sheer lack of supply will continue to put upward pressure on taking rents. Class B rents have increased 1.4%. The longer-term trend, however, shows that both Class A and Class B rents have remained relatively flat since 2019.