DC Trophy Office Rents Rising
Vacancy rates are dipping and office absorption is up, so landlords are finally feeling a little more comfortable in the office market. Trophy landlords, that is. According to a Transwestern study, rents for trophy office buildings are expected to rise up to 3% this year. Coupled with that bump, Transwestern expects concessions for rents in trophy offices to start to drop. No other office class in the market will be sharing in the good times, however. The average concession of 10.3 months free rent on a 10-year lease should be relatively flat for Class-B and C buildings. Landlords are making great money on sales, however: investments in the first half of 2015 in the District reached $1.5B, with the average sale at nearly $800/SF. Those numbers were boosted by the $1,083/SF sale of America's Square on Capitol Hill to Jamestown Properties in February. [Transwestern]
