As of August, the national office vacancy rate remained high, as key office markets are suffering lasting changes, according to the latest Yardi Matrix U.S. office market outlook.
Read the latest Yardi Matrix Office Market Outlook.
Report Highlights:
- The national office vacancy rate stood at 18.7 percent as of August—down 80 basis points over the past 12 months.
- The national full-service equivalent listing rate clocked in at $32.63 per square foot as of August, marking a 0.4 percent year-over-year decrease.
- The sector’s under-construction pipeline comprised 40.2 million square feet —unchanged from the previous month.
- Office transaction volume reached $33 billion as of August, with assets selling at an average of $190 per square foot.
Hybrid work impacts vacancies
As of August, the national office vacancy rate stood at 18.7 percent—down 80 basis points over the past 12 months. Five years after the start of COVID it is more clear that office utilization is unlikely to return to pre-pandemic levels, as hybrid work policies are here to stay. As a result, the office landscape now faces a series of lasting changes, such as elevated vacancies across multiple key metros.
One example is Seattle, that had a 27.2 percent vacancy rate as of August. With a once-booming pipeline driven by the office-using sectors’ rapid expansion, the city’s employment in the tech and information sectors continues to fall since 2022. Coupled with remote work policies, Seattle’s traditional office sector will keep changing. For context, other markets with high vacancies include San Diego (22.6 percent), Dallas (22.4 percent) and Austin (26.5 percent), while at the other spectrum is Miami, with 14.3 percent.
Meanwhile, the national average full-service equivalent listing rate stood at $32.63 per square foot—nine cents lower than the previous month and down 0.4 percent on a year-over-year basis. Manhattan’s rents kept the leading spot, at $67.96 per square foot, while San Francisco followed, with $64.15 per square foot.
Construction activity on standby, investment keeps steady
Nationwide, there were 40.2 million square feet under development—accounting for 0.6 percent of stock. When adding projects in the planning stages, the figure reached 1.9 percent. As of August, Boston continued to be the top office market for development, with 5.6 million square feet in its pipeline, while Manhattan followed, with 3.4 million square feet.
The office investment volume reached $33 billion this year through August, with office properties selling at $190 per square foot—a slight increase from 2024 but significantly lower when compared to pre-COVID prices, when properties sold at $277 per square foot, back in 2019. As of August, Manhattan regained its leading position, with $5 billion in sales, while the Bay Area came in second place, with $3.4 billion.
Read the full Yardi Matrix Office Market Report: September 2025.
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