U.S. Office Vacancy Rate Edges Higher in Q2

U.S. Office | Q2 2022

26 Jul 2022 1 Minute Read

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Executive Summary

  • With the completion of nearly 10 million sq. ft. of office space outpacing 6.2 million sq. ft. of demand in Q2, the overall office vacancy rate edged up by 10 basis points (bps) to a pandemic-era high of 16.9%.
  • While net absorption surged to 6.2 million sq. ft. in Q2 from 1.1 million sq. ft. in Q1, it was well below the Q2 average of 14.5 million sq. ft. from 2015 to 2019.
  • Inflationary pressures and uncertainty around office utilization caused some hesitation among tenants, which slowed leasing volume for a second consecutive quarter.
  • Asking rents increased 1.4% year over year. Rent growth in suburban markets continued to outperform downtowns.