Suburban Maryland Office Figures Q4 2023

The Suburban Maryland office market recorded 194,000 sq. ft. of negative absorption during the fourth quarter of 2023, bringing year-end totals to 633,000 sq. ft. of occupancy loss. This marks the first back-to-back years of occupancy loss since 2013-2014. In turn, vacancy increased 60 basis points (bps) over the prior quarter to 19.8%.

During the fourth quarter, Federal Realty delivered 915 Meeting Street, a 276,000 sq. ft. trophy office building at the Pike and Rose mixed-use development in the North Bethesda submarket. The building is 57% leased overall: Choice Hotels pre-leased 105,000 sq. ft. in October 2021 and will vacate 156,000 sq. ft. at its headquarters in Rockville; Sodexo also signed a 52,000 sq. ft. prelease in the building in October 2022 with plans to relocate its operations from 9801 Washingtonian Boulevard in Gaithersburg.

No other office properties are currently under construction in the Suburban Maryland market. This slowdown in new supply paired with the ongoing trend of office-to-residential and office-to-life-science conversions will likely help stabilize vacancy.