WASHINGTON, DC—The vacancy rate for trophy space in the District continues to fall from a recent high-water mark of nearly 13%.
According to brokerage firm JLL, the office vacancy rate for trophy properties in Washington, DC fell from 9.9% in 2013 to 9% at the end of 2014. The vacancy rate for trophy space in the District was 12.8% in 2012.
JLL Research Director Scott Homa says that demand is picking up for top tier space in the District, which is prompting JLL to believe that rental rates now at approximately $50-per-square-foot triple net, could start to increase by between 3% to 5% over the next year.
"The D.C. market always tightens from the top down, and we hit a clear inflection point in 2014 with a downward vacancy rate," says Homa, who adds that a significant amount of activity in this sector in 2014 was from government affairs companies, such as Airbus and Visa.
While the trophy market is in recovery, the rest of the office market in the DC area is still struggling. Some locations and building types are posting vacancy rates higher than 20%. See story in the Washington Business Journal.
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