It's been a slow recovery for Boston's office sector — but 2026 might be the year that meaningful recovery is seen in the market. This comes from Colliers' fourth-quarter Boston office report.
In the meantime, the region has some encouraging signs to build on. For example, demand seems to be strong, with net absorption turning positive to 912,000 square feet at the end of 2025, compared with the negative 615,000 square feet seen in the 12 months prior.
"In the second half of 2025, the metro posted one of its strongest two-quarter periods of positive net absorption since the pre-COVID period, causing vacancies to start shrinking," Colliers said.
Vacancy slipped by 20 basis points in the fourth quarter to 23.9 percent compared with the previous three months and was flat year-over-year. While the rate has stabilized, availability remains significantly higher than historical trends. For example, vacancy is now 16 percent higher than pre-COVID levels and 10 percent above the historical average.
Furthermore, a record high of 17 million square feet of office space is available for lease in Boston. On top of that, supply surged to 660,000 square feet compared with no deliveries at the end of 2024. On the bright side, construction was cut in half to 750,000 square feet, which Colliers does not expect to "significantly impact market vacancy."
Average asking lease rates increased to $45.34 per square foot, from $44.68 per square foot in the fourth quarter of 2024.
Overall, despite the slow recovery in the market, the brokerage forecasts Boston's office sector's fundamentals will see improvement in 2026. The high vacancy levels are anticipated to create "favorable leasing opportunities for the foreseeable future," Colliers added.
Cross Ocean Partners and Lincoln Property Company teamed up to make the largest office purchase during the fourth quarter, buying a property at 140 Kendrick Street for $132 million. DivcoWest and Montana Avenue Capital Partners came in second and third with acquisitions being $125 million and $84.50 million, respectively.
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