Availability skyrockets to new record-high rate, pushing the market further into the tenant’s favor
The District has been a tenant-favorable market for over a decade, but the effects of COVID-19 have only amplified these conditions. In the fourth quarter, overall availability surged to 19.4%, eclipsing the previous record hit just last quarter (18.1%). This marks an increase of 130 basis points (bps) over the quarter and 330 bps over the year. The current rise in availability comes in part from the rapid return of sublease space to market. Over the quarter, sublease inventory grew by 0.5 million square feet (msf), bringing the total amount of available sublease space to 3.4 msf – a new high. DC’s supply and demand imbalance has gone further offkilter as many organizations continue to take a “wait and see” approach to future office space planning, exacerbating the demand shortfall.