Seattle tops national list for office space sales while pandemic-level vacancy rates persist
Year-to-date ending in May, the Seattle metro area sold the highest dollar value of office spaces in the U.S., recording $2.17 billion in total sales, according to a report released by CommercialEdge, a commercial real estate data service.
Seattle was only one of two national markets to exceed a $2 billion-sale threshold, the other being Manhattan, which recorded $2.146 billion in sales last year.
The report comes as Seattle continues to struggle with enticing workers back into the downtown area. Office vacancy in the central business district remains at roughly 20%, according to data from Cushman and Wakefield, a commercial real estate firm. National office space vacancies linger at roughly 15%, unchanged year over year.
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ComercialEdge speculates that remote and hybrid work trends will remain, despite being niche before the pandemic.
However, real estate speculators could be moving ahead of a subsequent federal interest rate hike, with large investments in Seattle and Manhattan indicative of that trend. At the end of May, year-to-date office sales reached $35.3 billion, of which $8.6 billion were recorded in May 2022 alone.
Seattle’s office sales were buoyed by Boston Properties’ $730 million purchase of the Madison Centre, the largest sale of a multi-tenant building this year. That sale “signals Boston Properties’ belief that tenants are engaged in a flight to quality,” CommercialEdge speculates.