Seattle/Puget Sound office market concludes 2022 with a sudden and significant decline in leasing activity

Much like the national environment, the Seattle/Puget Sound economy and workforce has grappled recently with unresolved back-to-office policies and layoffs in the technology sector. In the wake of this, leasing activity totaled 1.0 million square feet (msf) in the fourth quarter. This tally marked a 47.4% decline from last quarter (1.9 msf), and a 37.5% drop-off from Q4 2021 (1.6 msf). While full year 2022 leasing (5.5 msf) was down just 2.1% from 2021 (5.5 msf), transaction levels remained 36.3% below 2019 (8.4 msf), prior to the start of the pandemic. Despite a recent decline in office-using employment growth, the region’s unemployment rate has remained low at 2.9% (as of November 2022), outperforming the 3.7% national rate. Among the largest deals completed this quarter were Brooks Sports, which leased 112,675 square feet (sf) at 3435 Stone Way North in Lake Union, while Kimley-Horn leased 46,466 sf at 1201 3rdAvenue in Seattle’s Central Business District (CBD).

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