Q2 2025 U.S. office market overview

The overall availability rate for U.S. office space sat at 23.2% in Q2 2025, comprised of a 20% direct availability rate and 3.2% sublet availability rate. Q2 2025 was the fourth consecutive quarterly decline in overall availability—a trend not seen since before 2016. 

Quarter over quarter, direct available space decreased by 3.6 million square feet (msf) and sublet available space decreased by 5.6 msf, netting a 10.2-msf decrease in total available space. While the availability rate remained historically high, this quarterly decrease in supply is a positive indicator for the U.S. office market.

U.S. office leasing activity totaled 138 million square feet (msf) in the first half of 2025—down 16.2% from the pre-COVID average (2000–2019) of 164 msf, and 13.9% below H1 2024’s volume of 160 msf.

However, several key markets are showing strong momentum: San Francisco’s leasing activity is up 61% year over year and Manhattan has risen 17.2%, with both markets at or approaching pre-COVID leasing levels (San Francisco is 20% below, while Manhattan is 1% ahead).

Office sales volume surged 69% over the past four quarters compared to the prior year, signaling renewed investor interest in the sector.

Trophy and class A assets dominated the market, accounting for more than 71% of the $40.8 billion in total transactions during this period.

Notably, gateway and Sun Belt markets—including Manhattan, Miami, Los Angeles, Chicago, Houston, and Dallas—all experienced a marked rebound in sales activity, reflecting growing demand for high-quality office product in key markets.