Leasing nearly doubles over the quarter with government contractors active

Second-quarter leasing activity totaled 2.5 million square feet (msf), on par with the five-year-quarterly average, and nearly double the volume seen in Q1 (1.6 msf). The largest transaction of the quarter - accounting for 20.6% of volume alone – was Raytheon’s renewal of 521,366 square feet (sf) across 22110, 22260 and 22270 Pacific Boulevard in Route 28 Corridor North. Including this lease, activity from the professional services sector (primarily government contractors) comprised 52.0% of leasing volume. While an increase in transaction activity will help to provide some market stabilization, Northern Virginia needs net new demand to reduce the extensive oversupply of space. The technology, advertising, media and information (TAMI) sector has been the primary source of new growth throughout the pandemic, but accounted for just 9.3% of activity in Q2.

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