DC Lease Absorption Posted Worst Year on Record

WASHINGTON, DC-First the bad news. The DC area posted its worst year on record in terms of absorption, Jones Lang LaSalle reports: 3.3 million square feet of negative net absorption. Now the good news: more than half of that was due to BRAC, or the Base Realignment and Closure Act, JLL Research Director Scott Homa tells GlobeSt.com. “Much of that space was functionality obsolete and should have been vacated earlier,” he says. “So the numbers aren’t quite as bad as they seem.” In short, he says, 2012 was a challenging year but it felt more like a period of stagnation than sharp contraction.

Even with that caveat, however, the numbers are indisputably dismal. Leasing was down over 20% and tenants that did move took on average 15-20% less space. Also, renewals accounted for over half of the transactions in the market in 2012.