Mid-Atlantic Research Reflections 2021 - Nonprofits

November 9, 2021

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2021 has remained a challenging year for the nonprofit sector as membership and fundraising events continue to be adversely impacted by the pandemic. According to a recent survey of 163 nonprofit leaders published by The Center for Effective Philanthropy, 78% of organizations have reported negative effects from the pandemic, while 57% have seen a drop in revenue. Across the Washington region, nonprofit employment has declined by 15,900 jobs (-8%) from the 2019 level, of which 6,600 jobs were lost in the District (-9%).

The effect has been reflected in the region’s nonprofit office leasing activity, which at 837,000 sq. ft. year-to-date is notably down from the historical annual average of 1.6 million sq. ft. The sector has recorded five consecutive quarters of net occupancy decline for a total loss of 319,000 sq. ft. (Q3 2020 – Q3 2021), as several organizations have downsized due to remote work and cost-cutting. Nonprofits have also been a leading contributor of sublease spaces in the region, with 137 organizations having added a combined 1.7 million sq. ft. of availability to the sublease market during the pandemic.

Nonetheless, some nonprofits have gone against the tide and expanded their office presence. In the largest D.C. nonprofit lease year-to-date, PCORI more than doubled its footprint in its relocation to the newly renovated 1333 New Hampshire Avenue, NW. Environmental Working Group, Voter Participation Center, and Color of Change are among additional examples of nonprofits growing their footprint.