We are pleased to release the latest State of the U.S. Office Market. This quarterly presentation provides key metrics on office leasing and the current state of the capital markets within the sector.
A few noteworthy facts from our research:
- In Q2 2024, U.S. office market leasing activity was 48.6 million square feet (msf), up 6.3% over Q1 2023 but still below pre-pandemic levels.
- Office availability now stands at 25.1%, flat from last quarter with available sublease space decreasing for the third consecutive quarter to 165.6 msf.
- Occupiers in a strong financial position remain in the driver's seat, however, intense competition for Trophy Class A space is expected to continue as leasing market is bifurcated.
An estimated $41.0 billion in office loans are now distressed, approximately 44% of all currently distressed commercial real estate loans. There is cautious optimism as the Federal Reserve is signaling rate cuts in the second half of 2024, however, the period of near-zero interest rates is now over.