The U.S. office market is revealing an unusual paradox, with abundant available space but far fewer suitable options for today's occupiers. As companies make larger commitments and gravitate toward a select group of properties, the distinction between available space and truly competitive buildings is becoming increasingly pronounced.
Highlights from the report:
- U.S. office leasing reached 191.4 million square feet through Q3 2026, up 11.3% year over year, with third-quarter transaction volume marking its highest level in a decade.
- Across 14 major markets, just 12.8% of office buildings offer contiguous blocks of 50,000 square feet or more, with options narrowing considerably when factoring in Class A quality, desirable submarkets and trophy status.
- Overall office availability fell to 22.3%, down 170 basis points year over year, while new construction is on track for its lowest annual total in decades.
- Office property values rose 4.0% annually, the largest increase since Q2 2022, although $134.2 billion in outstanding and potentially distressed office debt remains a headwind.
- The U.S. economy continues to benefit from consumer spending and substantial investment in AI and technology, although trade uncertainty, persistent inflation and elevated financing costs present challenges to future growth.