Raleigh Office Market Report
Annual full-service class rental rates recorded a historic high of $30.69/SF, reflecting a 3.2% increase year over year, but rental growth has begun to flatten as vacancy has continued to climb and leasing activity has continued to be muted. Occupancy declined quarter over quarter as several new projects delivered vacant during the quarter, leading overall vacancy rates to increase 320 basis points to a historic high of 19.9%. The under-construction pipeline significantly declined to 102,500 SF currently in progress as several under-construction projects, such as One North Hills Tower and 1000 Social @ The Exchange, delivered throughout the quarter and fewer projects have broken ground due to higher building costs, steeper cost of debt and significant vacancy to be absorbed. Total leasing activity closed the quarter at 581,485 SF with one of the lowest levels of leasing activity on record, 45% below the 16-year second-quarter average of 1.0 MSF.
Download Raleigh Office Market Report 2Q24