Demand is up 44% over the year, bolstered by government and tech leasing

In the third quarter, 2.1 million square feet (msf) were leased, a 44% increase in transaction volume compared to the same period last year, and nearly on par with the five-year quarterly average (2.5 msf). Leasing volume dropped some from last quarter, but remains stronger than pandemic low points. The largest transaction of the quarter was a renewal for the Environmental Protection Agency at 2777 Crystal Drive, totaling 315,231 square feet (sf). Government tenants continue to drive demand, accounting for 30.7% of activity, closely followed by the professional services sector – heavily made up of government contractors (26.0%). The technology, advertising, media and information (TAMI) sector saw leasing nearly double from last quarter, accounting for 18.6% of transactions by volume. Notably, Splunk leased 57,521 sf at 7900 Tysons One Place and Amazon expanded by another 55,571 sf in National Landing at 2345 Crystal Drive. The technology sector has invigorated the Northern Virginia market in recent quarters, bringing new companies to the area along with new growth.

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