Washington, D.C. sees slowdown in leasing demand to start the year
Washington, D.C. office leasing exhibited a moderate slowdown in the first quarter as occupiers became more cautious over omnicron concerns. Just 1.1 million square feet (msf) was transacted this quarter, compared to a whopping 3.0 msf last quarter, and slightly less than the 1.2 msf leased a year ago. While the end of the year typically has a higher volume of lease executions, this was markedly lower than expected and may be only a temporary slowdown in demand. The federal government, D.C.’s largest employer and lessee of office space, has been out of the office since the pandemic started. Their program of a required return-to-office is expected to have a large psychological impact on the private sector when federal employees return officially. Despite this stutter-step in recovery for office demand, many companies are willing to take advantage of favorable market conditions and abundance of quality available options.