Seattle Market Snapshot Q4 2022

The Puget Sound’s office market continues to realize negative setbacks from the shift to remote work in addition to the looming threat of an economic recession. As a result, we have seen total office demand in Seattle significantly decrease during the 2022 year – measuring at half of 2021’s active tenant demand. As of Q4 2022, the entire Seattle market observed a vacancy rate of 14.24% (a 0.06% increase) and 13.83% (a 0.13% increase) across Class A buildings, respectively. Furthermore, we observed an increase in sublease vacancy to 5.27% (a 0.60% increase) or 3.3M SF. The resulting combined vacancy between sublease and direct available space was 19.5% as of FY 2022. We expect to see a leveling out in direct vacancy of ~27% (not including any sublease vacancy) by the year-end 2024 as companies begin to establish RTO plans resulting in new leasing activity throughout the region.