Uncertainty in the market and limited price discovery increased demand for flexibility by office users in Q4 2020. Tenants and landlords opted for shorter-term leases and renewals while they wait for business conditions to return.
The Eastside has fared better than other Puget Sound office markets. The vacancy rate for the Eastside increased 114 bps to 8.9%, and asking rates remained stable.
Downtown Seattle vacancy continued to rise, reaching a 5-year high of 12.0%, while absorption reached decade lows of negative 586,202 sq. ft.
Despite dormant leasing, capital markets activity picked up in Q4; in total, six deals over $100 million closed this quarter.