Salt Lake City-Provo Office Figures Q1 2025

Office fundamentals continued to recover in the first quarter of 2025. Increasing leasing activity characterized the period, rising by 36.4% year-over-year to a total of 1.23 million sq. ft. This growth, coupled with no new office completions, influenced the total vacancy rate to decrease for the second consecutive quarter, dropping by 22 basis points to 23.7% in Q1 2025, while the direct vacancy rate fell by 28 basis points to 19.6%. Sublease availability remained flat at 2.5 million sq. ft. in Q1 2025, following five quarters of consistent decline.

Net absorption remained positive for the second consecutive quarter after a two-year slump, marking the strongest first-quarter occupancy gains witnessed since Q1 2020, with 125,935 sq. ft. of positive net absorption. This was driven by tenants occupying spaces secured earlier and sustained demand for high-quality office space in connected and amenity-rich locations. Consequently, downtown Salt Lake City (CBD and CBD Periphery) performed significantly better in Q1 2025, recording 161,810 sq. ft. of positive net absorption, with gains in Class A (81,665 sq. ft.) and Class B (128,498 sq. ft.) buildings, offsetting suburban losses. Looking ahead, the Salt Lake City-Provo office market is well positioned for further recovery throughout 2025, and net absorption is projected to remain positive in the near-term forecast.