Northern Virginia office market: New and upgraded buildings dominate leasing activity

Office leasing in Northern Virginia is increasingly concentrated in recently upgraded and newly delivered buildings. Although these assets represent just 9.7% of total inventory, they account for 28.4% of leases over 20,000 SF signed in the past 2 years in Northern Virginia, underscoring outsized tenant demand for new or renovated space.

As market bifurcation intensifies, Class A and Trophy buildings are capturing the majority of leasing relative to their share of inventory. Tenants continue to prioritize buildings with upgraded amenities, advanced building systems, and modern design.

With a limited development pipeline and an increasing number of underperforming buildings converting to residential use, the region’s office inventory is shrinking. This reduced supply and increased demand for top-tier product will continue to place upward pressure on rents in the newer and refreshed segments of the market.