Northern Virginia’s Town & City submarkets include Fairfax City, Falls Church, Vienna, McLean, Oakton, and Great Falls (in order to rentable building area). Of the combined 13,509,588 total square feet only 1,592,828 SF is comprised of 4 & 5 Star properties (11.8%). The fact that these submarkets’ average asking rents are below the metro average ($37.53/SF) is the result of the predominance of 3-Star and 1 & 2-Star properties and not necessarily due to supply and demand fundamentals as evidenced by the fact that all but Oakton have vacancy rates below the metro average (12.95%). Tenants that choose to locate their business in these submarkets do so for different reasons than traditional office users; making these submarkets unique when negotiating lease terms. Oftentimes, it’s “take it or leave it.”
Fairfax City
- RBA: 5,047,260 SF
- Vacancy Rate: 10.8%
- 12 Month Net Absorption: 46,300 SF
- Average Asking Rent: $24.78
- 12 Month Rent Growth: (0.6%)
The number of office condos in Fairfax City and non-institutional landlords/owners impact market fundamentals in a way that is more reflective of said owners’ individual, financial “market” than outside market conditions.
City of Falls Church
- RBA: 2,829,773 SF
- Vacancy Rate: 12.6%
- 12 Month Net Absorption: (32,600 SF)
- Average Asking Rent: $25.49
- 12 Month Rent Growth: 1.1%
Town of Vienna
- RBA: 2,007,856 SF
- Vacancy Rate: 7.5%
- 12 Month Net Absorption: (9,500 SF)
- Average Asking Rent: $28.56
- 12 Month Rent Growth: 1.5%
Vienna apparently has 662,589 SF of 4 & 5-Star properties, but you’d be hard-pressed to identify them.
McLean
- RBA: 1,701,139 SF
- Vacancy Rate: 10.6%
- 12 Month Net Absorption: (45,500 SF)
- Average Asking Rent: $31.38
- 12 Month Rent Growth: (0.4%)
Despite having ZERO 4 & 5-Star properties, McLean has the highest average asking rent of these submarkets at $31.38/SF. Proximity to DC matters.
Oakton
- RBA: 1,649,594 SF
- Vacancy Rate: 16.4%
- 12 Month Net Absorption: (5,400 SF)
- Average Asking Rent: $27.26
- 12 Month Rent Growth: 2.0%
Poor Oakton. At 16.4% this is the only submarket in this category that has a vacancy rate higher than the metro average.
Great Falls
- RBA: 273,966 SF
- Vacancy Rate: 7.2%
- 12 Month Net Absorption: (5,000 SF)
- Average Asking Rent: $25.97
- 12 Month Rent Growth: 2.2%