Des Moines Office Figures Q4 2022

Market Summary

–Construction remains underway on Worldwide Logistics new headquarters in Urbandale at 12400 Meredith Dr. The new development is 76,000 sq. ft. and expected to be completed Q2, 2023.

–Access Systems began construction on new headquarters in Waukee at 1055 SE Olsen Dr. The new development will be 30,000 sq. ft. and is expected to be completed summer of 2023.

The Des Moines office market experienced positive absorption for the 2nd straight quarter. Four of the six submarkets recorded positive absorption quarter-over-quarter (Figure 2). However, there was only 15,000 sq. ft. of positive absorption in Q4. Overall net absorption for 2022 was negative 36,185 sq. ft.

Overall vacancy rates remained largely flat quarter-over-quarter, only experiencing a decrease of 10 basis points (15.5% to 15.4%). The CBD submarket vacancy rate decreased 20 bps (18.1% to 17.9%) quarter-over-quarter and decreased 100 bps (18.9% to 17.9%) year-over-year.

Overall asking lease rates decreased by $0.10 quarter-over-quarter ($13.76 to $13.66 per sq. ft.) The highest asking lease rates in the market originate in the City of Waukee (part of the Western Suburbs submarket) with an average asking rate of $19.61 per sq. ft.