Seattle office sublease availability drops to lowest level since 2020
An uptick in office space demand has absorbed some of the sublease inventory in the Seattle market, dropping availability to the lowest level since 2020.
Available sublease space in Seattle fell to 4% at the end of 2024 from 6.1% when the year began, according to data from Colliers. The 2.61 million square feet of vacant sublease space is only 200,000 square feet higher compared to the first quarter of 2020, the pre-pandemic baseline when sublease vacancy stood at 3.7%.
The reduction in subleases hands the control back to the landlords, which effectively calms the jittery commercial real estate sector, Colliers research manager Jacob Pavlik told the Business Journal.
“A company subleasing space is just trying to get cost recovery,” Pavlik said. “Whether you’re getting $5 a square foot, or $20 a square foot, you just want to get something back instead of losing more and more money. So having fewer subleases makes the market more predictable. It makes it more rational.”
Subleases currently make up 13% of the total vacancy in Seattle, the lowest share in more than five years.
Many subleases have also “burned off” or turned into direct vacancies as the original tenant terms expired.
In November, the Business Journal reported Amazon is allowing its lease at a building in Denny Triangle to lapse, as the tech giant continued to revise its office space usage across the Puget Sound region.
Meanwhile, Seattle’s largest lease of 2024 was the 193,000 square feet of space at South Lake Union’s Arbor Blocks that Apple took over from Meta Platforms. Originally intended to be a sublease, Apple later signed a direct deal with the building owner Ponte Gadea.
Companies that are in the market for new space are “signing deals for larger median square footage and for a longer amount of time, which to me says that on the demand side of the equation, there’s more stability as well,” Pavlik said.
Leasing activity overall is picking up, as more companies require their employees to return to the workplace.
Across the Seattle region, office occupiers absorbed more than 5.9 million square feet of space last year, up from 4.6 million square feet a year prior, according to Savills’ fourth quarter report.
Still, overall vacancy ticked up throughout the year, growing 260 basis points to 28.7%.
Seattle office sublease space drops to lowest level since 2020 – Puget Sound Business Journal
