WASHINGTON, DC–A new research note from JLLconcludes that the federal government is losing the leveragetenants typically have in this city with landlords. The reason?Space options for federal agencies that are greater than 50,000square feet in Washington, DC have declined by 35% since 2015. Atthe same time, since the beginning of 2014, federal government neteffective rents have increased by nearly 30%.

Driving this trend has been the rapid population growth and thedelivery of new multifamily, retail and neighborhood amenities tothe Southwest, NoMa and the Ballpark submarkets, leading developersto ditch their federal government leasing plans and shift focus totarget the private sector at rates that are 10%-20% above thefederal government's prospectus cap, JLL said.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.