Despite its location as an outlying submarket in Prince William County without direct access to a Metro station, the Route 29/I-66 Corridor has more stable fundamentals than many submarkets. Vacancies have declined since 2012, aided in part by a dearth of construction, although several potential move-outs by the likes of Aerojet Rocketdyne, Prince William County, and the McLean Bible Church could cause the most significant vacancy expansion in half a decade. Less than 60,000 SF of space is under construction, and building isn’t expected to pick up anytime soon, since low rents make it difficult for projects to pencil out.
The bulk of recent demand has come from medical office users such as the Center for Vein Restoration, Nelson Dermatology, and the Vision Therapy Center of Virginia. The FBI also maintains one of its primary field offices in the Route 29/I-66 Corridor, across Prince William Parkway from Northern Virginia Community College’s Innovation Park. Despite declining vacancies, rent growth has failed to gain traction this cycle, leaving rent levels well below the pre-recession peak. Sales have been strong, though, with volume setting a record in 2016 at nearly $50 million. Sales were about $26 million in 2017, well above the historical average, but have slowed significantly this year. Most of the trades so far in 2018 have involved smaller buildings trading for a few hundred thousand dollars or less. As of mid-October, volume was just over $7 million.
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