Research
SVN State of the Market Report 2025
OFFICE
US Office fundamentals continue to experience regional divisions, but nationally, listing rates have climbed from a 2023 floor. According to Commercial Edge’s National Office Report, the average price per square foot of office space increased by 4.5% year-over-year; all the while, vacancies continue to climb.
Before the Office sector can stand on its feet again, it must first make landfall, and jointly, the uptick in rents and vacancies offer clues about its progress.
Structural economic changes affecting the economic value of office space - including long-term remote work trends and AI adoption - are spurring a generational downsizing of the sector’s footprint. Just 43.2M square feet of Office space was delivered in 2024, 36% lower than the 2019 delivery rate.
Consequently, the national supply of office space is gradually shrinking, and although the vacancy rate continued to rise in 2024, the pace of increase slowed. Over the same period, the most space-shedding tenants have been largely accounted for. According to reporting from Hines, one of the world’s largest privately held real estate managers, their tenants returned about 10% of space on average in 2024 compared to nearly 33% 12-18 months prior.
