There are 71.5 million sf of vacant office space in the Washington D.C. region. The national real estate brokerage Marcus and Millichap expects one-fifth of metro D.C.’s total office space to be empty by the end of this year. And another 1 million sq of office space could come onto this market over the next several years as businesses vacate older buildings once their leases expire.
The D.C. suburbs are fast becoming the latest American ghost towns, according to the Washington Post, as work styles have changed, preferences have shifted toward walkable commutes, and government—the area’s biggest employer—has shrunk.
The corporate campus is far from dead—just ask Google, Facebook, and other Silicon Valley companies that are building massive new headquarters and reinventing this concept to be transit-oriented and Millennial-friendly.
The D.C. suburbs are fast becoming the latest American ghost towns, as work styles have changed, preferences have shifted toward walkable commutes, and government—the area’s biggest employer—has shrunk.
The U.S. Bureau of the Census’ latest estimate for the value of private office construction put in place was up, year-to-year, 24.6% in May to $55.4 billion. Spending on public office construction in May rose 26.9% to $46.6 billion.
But in certain states, there have been mass evacuations of office spaces. In New Jersey, pharmaceutical firms that once operated sprawling suburban campuses have left millions of square feet of office space, warehouses, and labs deserted.
Empty office buildings have been a fact of life in D.C. and its suburbs for a while. By mid-2014, 11 Montgomery County, Md., office buildings totaling 2.25 million sf stood almost or totally vacant, and another nine, totaling 1.4 million sf, were “almost totally available”.
A portion of vacancies is attributable to federal government cutbacks. The Post reports that government agencies have been evacuating office and warehouse spaces in droves. They vacated 7,315 buildings with 47 million sf of office space in 2014 alone, reports Federal News Radio.
Still, office construction continues in D.C., and some developers and AEC firms view this market’s office space surfeit as an opportunity, although most of the recent activity is occurring within the city’s limits.
Skanska disclosed last week that it is investing $116 million in a new office building in D.C. The giant contractor will develop and build a new 11-story, Class-A office building with ground floor retail and four below-grade parking levels in Washington’s Capitol Riverfront submarket. The total leasable space will be about 22,000 sm (237,000 sf). Construction is scheduled to begin later this summer.
Tishman Speyer recently paid $30.5 million to acquire 2020 M Street N.W., the longtime D.C. bureau of CBS News, which it will redevelop into a modern office, newsroom and studio space for the media giant.
On July 21, Carr Properties, a local owner/operator/developer, acquired Columbia Center, a 393,815-sf, 12-story Class A office building in Washington D.C., for an undisclosed amount. In May, the Post reported that Carr Properties had raised $300 million from Alony Htez Properties and Investments, one of Israel’s largest real estate investment companies, to invest in local office buildings and development projects.
Related Stories
Lighting | Aug 2, 2017
Dynamic white lighting mimics daylighting
By varying an LED luminaire’s color temperature, it is possible to mimic daylighting, to some extent, and the natural circadian rhythms that accompany it, writes DLR Group’s Sean Avery.
Office Buildings | Aug 1, 2017
Corporate values as workplace drivers
Connecting personal values to company values is important to millennial workers.
K-12 Schools | Aug 1, 2017
This new high school is the first to be built on a tech company’s campus
Design Tech High School, located on Oracle Corporation’s Headquarters campus, will span 64,000 sf across two stories and have a capacity of 550 students.
Reconstruction & Renovation | Jul 31, 2017
New Jersey office building will undergo ‘live-work-play’ renovation
The 100,000-sf building is part of a three-building, 30-acre campus.
Office Buildings | Jul 27, 2017
*UPDATED* This will be the largest flight training center in Europe and the Middle East
The center will cover about 30,000 sm and feature 18 simulators.
Office Buildings | Jul 26, 2017
Meeting space leads to innovation
PDR Principal Larry Lander explains how to design for workplaces where four generations are working together.
Office Buildings | Jul 20, 2017
SGA uses virtual design and construction technology to redevelop N.Y. building into modern offices
287 Park Avenue South is a nine-story Classical Revival building previously known as the United Charities Building.
Office Buildings | Jul 19, 2017
James Corner Field Operations, designers of the High Line, creates rooftop amenity spaces for three Dumbo office buildings
The new spaces range from about 8,500 to 11,000 sf and were added to Two Trees Management’s anchor office buildings.
Reconstruction & Renovation | Jul 18, 2017
Mortenson Construction incorporates 100-year-old barn into new Portland office space
Mortenson deconstructed the barn and repurposed it for the new space.
Office Buildings | Jul 12, 2017
CetraRuddy unveils seven-story office building design for Staten Island’s Corporate Park
Corporate Commons Three is expected to break ground later this summer.