The office market in Washington DC is going from bad to worse, according to third quarter reports released this week, one of which characterized the DC market as "still reeling" from the pandemic and afflicted with "dismal market fundamentals."

The litany of dismal results cited by CBRE in its Q3 report on the DC office market included 351K SF of occupancy loss, bring YTD negative net absorption to 976K SF. Vacancies have increased 40 bps—they've now surged 580 bps above pre-pandemic levels—surpassing the 20% threshold for the first time, at 20.3%.

Perhaps most symptomatic of the malaise afflicting the DC market are the 3Q results for Class A properties, which in most US cities are benefitting from a flight to quality. Class A office properties in Washington registered negative net absorption of more than 391K SF in Q3, with the YTD tally now totaling negative net absorption of more than 1.5M SF.