Las Vegas Office Market
Despite reduced leasing activity, the fourth quarter of 2024 recorded a net occupancy gain of 171,948 SF, lowering vacancy by 30 basis points quarter-over-quarter. Under-construction office activity has slowed significantly, representing just 0.3% of existing inventory, with no new projects initiated this quarter. The pause in office construction reflects a wait-and-see approach, as developers and investors assess market absorption rates and macroeconomic trends. Asking rents remain higher than a year ago but are growing at a much slower pace than in previous years. Sublease availability declined this quarter as fewer large blocks entered the market, with small subleases dominating current availability.
Download Las Vegas Office Market Report 4Q24Las Vegas Industrial Market
Total vacancy (10.6%) crossed into the double-digits for the first time in 10.5 years. Net absorption has lagged construction deliveries for five-straight quarters. Available sublease space climbed to 1.8 MSF, representing 1.1% of existing inventory. While the square footage figure is pronounced, the percentage figure is still low relative to the market’s 1.7% high, reached in early 2010. Still-high inflation and more-restrained retail spending is prompting some occupiers to shed extra space to reduce overhead. Others are delaying their expansion plans. Leasing activity totaled 8.9 MSF this year, markedly lower than the 13.6 MSF in 2023. To compound matters, 6.4 MSF in under-construction space—little of which has pre-leased—will eventually deliver. Vacancy will continue to rise.