February 29, 2024 - Sejal Naik
Virginia’s office market remained sluggish to close out 2023. Vacancy rates are trending up as net absorption remains negative in most regions around the state. Even with a resilient job market, demand for office space is lower than it was pre-2020. Return-to-office mandates, while picking up, continue to trickle in and are often a hybrid schedule model. Nevertheless, rents held firm, rising slightly from this time last year across class types. Read the full report.
The retail market had a solid Q4 in Virginia driven by strong absorption in the Richmond region and Hampton Roads. Consumer demand for services has propelled much of the strength in the retail sector. Retail construction continues to increase, the vacancy rate is tightening, and rents are climbing as a result. Read the full report.
The demand for industrial space is still strong, but absorption has moderated from last year’s highs. Much of this demand is being driven by resilient consumer spending, specifically ecommerce. This is also reflected in strong job growth in the Transportation & Warehousing sector in recent months. Nearly all metro areas in Virginia had positive net absorption of industrial space in Q4, and rents are climbing rapidly across the state. Read the full report.
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