Report highlights
- The national office vacancy rate stood at 17.8% in August, down 90 basis points year-over-year.
- National full-service equivalent listing rates averaged $33.2 per square foot, up 1.7% year-over-year.
- The national construction pipeline totaled 32.4 million square feet underway, representing 0.5% of existing stock.
- Office sales volume reached $42.7 billion as of August, with properties trading for an average of $205 per square foot.
Loan maturities loom in high-vacancy metros
About 14,000 office properties carry loans that recently matured or will mature by the end of 2028. Together, these loans total $289.2 billion, or 33.5 percent of all office loan volume. Lenders originated 58.8 percent of the maturing loans before 2021, when expectations for office demand were stronger.
Eight of the top 25 office metros had vacancy rates above 20%. These markets accounted for $61.6 billion in maturing loans, with 54.9% of that volume originated before 2021. Seattle faced $8.3 billion in maturities alongside a 24.7% vacancy, while the Bay Area had $13.5 billion in maturing loans and San Francisco had $12.6 billion.
The national office vacancy rate stood at 17.8 % in August, 90 basis points lower than a year ago. Manhattan recorded the lowest vacancy among the top 25 metros at 10.2%, following a 340-basis-point year-over-year decline.
The national full-service equivalent listing rate was $33.2 per square foot, down 38 cents from July but up 1.7% year-over-year. Manhattan had the highest average asking rate at $72.7 per square foot, followed by San Francisco at $65.41 per square foot.
CBD construction pipeline contracts
The national construction pipeline totaled 32.4 million square feet in August, accounting for 0.5% of stock. CBDs had just 2.7 million square feet underway, representing 0.2% of stock and a 61.3% year-over-year decline. By comparison, 17.2 million square feet were underway in urban areas and 12.4 million square feet in suburban markets.
Office investment totaled $42.7 billion across 1,850 transactions closed through August. Properties sold for $205 per square foot on average, with Manhattan leading sales volume at $5.2 billion, followed by the Bay Area at $3.4 billion.
Atlanta pricing increased to an average of $158 per square foot in 2026 after three consecutive years of declines. Even with the improvement, prices remained 32.8% below the metro’s 2022 peak of $235 per square foot and 7.1% below 2019 levels.
CBD properties also faced greater valuation pressure than assets in other locations. Since 2024, 73% of CBD properties with comparable prior sale prices have traded at a discount, compared with 48% of urban properties and 42% of suburban properties. Continued flight to quality has concentrated tenant demand in fewer buildings as companies reassess their long-term space needs.
Read the full Yardi Matrix Office Market Outlook: September 2026.
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