Office demand remaining strong despite macroeconomic softening
Insight
15 April 2026
U.S. Office Market Dynamics, Q1 2026
Categories:
- Leasing activity grew 7.6% relative to Q1 2025 and is up 3.7% YoY in the past 12 months.
- Net absorption remained positive for the third consecutive quarter, with 3.5 million s.f. of quarterly occupancy gains. San Francisco (+1.6 million s.f.) and New York (+1.5 million s.f.) were the most substantial contributors to Q1 net absorption.
- Same-asset rents have increased 0.8% in the past year, led by Miami/South FL (+4.0%), Orlando (+3.0%), and New York (+2.2%).
- Q1 saw over 4 million s.f. of leasing volume executed at over $100 per s.f. starting rent (FSG), the highest Q1 volume recorded, following a record volume of high-rent transactions in Q4.
- Total inventory declined by 9 million s.f. in Q1 and has now declined more than 25 million s.f. from the peak in 2023 Q4.
- Completion volume from Q1 is the third-lowest ever in JLL’s data, and the pipeline currently stands at 22.3 million s.f., which is the lowest volume ever recorded in JLL data. Less than 1 million s.f. broke ground in Q1.
- Single-asset sales volume reached $11.5 billion in Q1, the highest Q1 total since 2020, growing 40% vs. Q1 2025 and 38% over the past year.
- Delinquency rates continue to rise, growing by 74 basis points to 11.41% from December to March. Buildings that traded at a reset basis in 2023-2025 are seeing steady occupancy gains under new ownership.