Suburban Maryland office market reports
Suburban Maryland’s Q2 office performance is showing signs of slowing tenant activity as landlords explore the potential of converting older, commodity office buildings to residential and lab on a go-forward basis rather than find a large office tenant to backfill the space. With limited deliveries YTD 2022, elevated availabilities are most notably attributed to existing supply, including 1.7 msf of sublet space, which again reached the highest point in the past several years.
One building has come online year-to-date, and the development pipeline has thinned as developers are reluctant to build speculatively.
As companies continue to ‘right size’, occupancy losses for the quarter amounted to about 0.2% of inventory.
Direct asking rent
While high concession packages are putting downward pressure on net effective rents, asking rates remained relatively stable in recent years.
Elevated total availabilities, including 1.7 msf of sublet space, persist and have again reached the highest point in the past several years.
The total overall vacancy rate continued its upward trajectory, ending the quarter 130 basis points higher than in Q2 2021.
Quarterly sales volume reached the highest level since Q4 2019 when the year-over-year increase was nearly 400%.
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Get in-depth office market reports and insights from commercial real estate experts in the Washington, DC Metro area. Avison Young advisors look at Suburban Maryland commercial real estate activities and the latest Suburban Maryland statistics to provide you expert market research on Suburban Maryland's office properties.
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