Norfolk Office Market Figures Q4 2022

The Norfolk office market recorded 256,000 sq. ft. of negative absorption in 2022 as forty-six tenants signed leases totaling 904,000 sq. ft, a 24% decline from the previous year. Large occupancy loss in 2022 included Norfolk-based Dominion Enterprises returning 103,000 sq. ft. of leased space to the market and consolidating its footprint within a building it owns at 150 Granby Street. These few blocks of space pushed vacancy rates to 11.0%, an 80 basis point (bps) uptick year over year.

In downtown Norfolk, twelve tenants signed for 195,000 sq. ft. of leasing transactions, accounting for 23% of gross leasing activity, a more than three-fold increase over 2021 submarket activity and the most activity of any submarket. The renewed activity in downtown Norfolk puts the submarket ahead of the growing suburban markets such as Greenbrier, which saw six leases signed in 2022 for 159,000 sq. ft.

In another positive sign, W.M. Jordan’s 80,000 sq. ft. project on the Peninsula broke ground at 800 Tech Center Parkway with an expected delivery in Q4 2023. This is the first office development to begin construction since the onset of the pandemic.