Northern Virginia office market reports
Q1 2025
Northern Virginia’s office market saw continued adjustments in Q1 2025, with vacancy rates dropping to 22.6%, aided by office-to-residential conversions. Availability tightened as total market space fell by 40 basis points quarter-over-quarter, and sublease availability also declined. While rental rates have plateaued from a recent rise, a decrease in concessions signals a stronger tenant demand and less need for incentives, reducing the need for tenant improvements and rent-free periods. Leasing activity slowed to 1.3 million sq. ft., yet notable deals—including Carfax’s 87,000 sq. ft. lease in Reston Station and DLT Solutions’ renewal of 51,621 sq. ft. in Herndon—highlight ongoing demand.
Net effective rent
After a spike in lease concessions over the past 12 to 18 months, they are beginning to come back down relative to rent prices. While landlords are still offering competitive levels of free rent and tenant improvement allowances, improving market fundamentals have allowed them to narrow the gap between base rent and net effective rent.
QTD sales volume
Office investments in Northern Virginia saw a slight downtick in volume compared to last quarter. As the value of office properties continue to decline, opportunistic investors and users alike could see incentives to capitalize on a lower pricing environment to enter or expand within Northern Virginia.
Percentage of new leases
This quarter, Northern Virginia experienced a higher percentage of new lease signings compared to the previous eight quarters, marking a shift from renewals, which had dominated transaction types until now.
Your source for the latest Northern Virginia office market reports
Get in-depth office market reports and insights from commercial real estate experts in the Washington, DC Metro area. Avison Young advisors look at Northern Virginia commercial real estate activities and the latest Northern Virginia statistics to provide you expert market research on Northern Virginia's office properties.
Explore different topics like the latest office market pricing trends and analysis of Northern Virginia's current office real estate market conditions. Gain a better understanding of Northern Virginia’s office real estate outlook and stay ahead of current office space trends. Make smart decisions when it comes to investing in office properties in Northern Virginia's competitive office real estate market. Avison Young is your trusted source for commercial real estate office market insights in Northern Virginia.
The dashboard was delivered through AVANT by Avison Young: leveraging real-time data and analytics to make cities and location-based decisions more transparent and efficient. Learn more about AVANT.