District of Columbia Office Market
The District of Columbia experienced 344,540 SF of negative net absorption during the third quarter of 2025. Registering 19.9% as of the third quarter, the vacancy rate increased 30 basis points quarter-over-quarter and 90 basis points year-over-year. Net negative absorption during the third quarter was partly due to several private sector tenants vacating leased space, including Georgetown University at 650 Massachusetts Avenue NW, Independent Bankers Association at 1615 L Street NW and Locke Lord at 2001 K Street NW. The sole property under construction in the district is 600 Fifth NW, a 400,000-square-foot office building in the East End that is scheduled to deliver in the first quarter of 2026. Half of the building is preleased to law firm Crowell & Moring. Overall asking rental rates increased 0.2% quarter-over-quarter during the third quarter of 2025 and are 2.9% lower than their peak in 2020, ending the quarter at $56.38 psf. Further conversion activity and a limited development pipeline will help to increase future rents. D.C. continues to benefit from one of the lowest sublease availability rates (2.2%) in the nation.
Download District of Columbia Office Market Report 3Q25