District sees record-level availability as a surge of sublease space hits the market
In the wake of COVID-19, sublease space flooded the D.C. market as many occupiers are focused on reducing real estate costs and, for many, the shift to work-from-home continues indefinitely. Since March, sublease availability has increased by 0.5 million square feet (msf), bringing the total amount of sublease space on the market to almost 3.0 msf. Sublease space now accounts for 13.0% of all available space for lease, up from 11.8% in Q1. The surplus of sublease space has pushed overall availability (direct and sublease space combined) to a new record-high rate of 18.1%. D.C. is suffering from oversupply caused by tenants shedding space and an onslaught of new construction delivering with limited pre-leasing.