CW DC Survey 3q16

Market Report
Washington, DC | 3rd Quarter 2016
cushmanwakefield.com
Contents
DC Metropolitan Area Overview..............................................................................3

Washington, DC & Map..........................................................................................4-6
Core (CBD/East End)...............................................................................................7-8
Non-Core...........................................................................................................................9
West End/Georgetown..............................................................................................10
Capitol Hill/NoMa.........................................................................................................11
Southwest/Capitol Riverfront..................................................................................12
Appendix..........................................................................................................................13
Tables..........................................................................................................................13-22
Methodology & Definitions......................................................................................23
About Cushman & Wakefield.................................................................................24
Cushman & Wakefield | 2
Washington, DC Metropolitan Area
While the narrative about job growthas well as the midterm

forecast for continued strong employment growthis compelling,
the headline may be that office market statistics are mixed. On the
one hand, vacancy appears to have peaked and is slowly declining
in the Washington, DC metro jurisdictions: the District of Columbia,
Northern Virginia, and Suburban Maryland. Regionally, vacancy was
17.8% at the end of the third quarter of 2016, down ever so slightly
from 17.9 % a year ago. But absorption is facing challenges. Current
space requirements per each job created in the Washington, DC
metro office market are much less than in previous cycles, and that
is having an impact on absorption levels. From 2002 to 2008, an
average 270 square feet (SF) of office space was absorbed for every
office job created regionally; from 2009 through 2016, that figure
declined to 60 SF. Furthermore, the contentious election season
seems to have put a damper on new leasing activity. Tenants have
taken a wait and see approach before executing new leases; that
has resulted in activity falling regionally to a year-to-date total
of 9.4 million square feet (MSF)below the 10-year average of
11.2 MSF typically registered in the first three quarters of a year.
The good news is that there are some signs that the pendulum is
swinging back from the extreme efficiency demands that caused
absorption to shrink in recent quarters, particularly in newer, highquality product in amenitized, transit-served locations. In the urban
core markets, two large law firmsVenable LLP and Arnold &
Porterboth exercised expansion rights shortly after or in advance
of occupying their newly constructed spaces. There is also evidence
that federal contractors are behaving similarly in suburban markets:
CSC has opted for another floor at 1775 Tysons Boulevard, adding
an additional 30,000 SF to its new Americas headquarters.
With continued growth in the economy, the improving (albeit
slowly) market conditions continue to keep investors bullish on the
outlook for the DC Metro region. Office sales activity surged in
the third quarter of 2016 by $2.1 billion, bringing the year-to-date
total to $4.9 billion. As has been the case throughout 2016, the
core downtown assets that brought downtown pricing to historic
highs in 2014 and 2015 remain scarce as longer term holders are
keeping these projects off the market. In turn, overall sales volume
has declined, with more suburban and value-add projects in the
pipeline for sale.
WASHINGTON, DC METRO
Economic Indicators
Q3 15
Q3 16
DC Metro Employment
3.18M
3.26M
DC Metro Unemployment
4.3%
3.9%
U.S. Unemployment
5.1%
5.0%
Q3 15
Q3 16
Overall Vacancy
17.9%
17.8%
Net Absorption
289K
544K
Under Construction
5.1M
8.4M
Deliveries
1.2M
2.5M
$35.03
$38.13
12-Month
Forecast
Market Indicators
Average Asking Rent (FS)
12-Month
Forecast
Net Absorption/Asking Rent

4Q TRAILING AVERAGE
$39.00
2.0
$38.50
$38.00
$37.50
1.0
$37.00
$36.50
$36.00
0.0
$35.50
$35.00
$34.50
-1.0
2010
2011
2012
2013
Net Absorption, MSF
2014
2015
2016
$34.00
Asking Rent, $ PSF
Washington, DC Metropolitan Area

NET ABSORPTION - DELIVERIES - VACANCY
10.0
20%
8.0
16%
6.0
4.0
12%
2.0
8%
0.0
-2.0
4%
-4.0
-6.0
Vacancy Rate
The Washington, DC metropolitan regions (DC Metro) economy

continued to register a staggering level of job growth through
the third quarter of 2016. As of September 2016, year-over-year
employment growth remained well above historical averages, with
the DC Metro economy creating 85,200 net new nonfarm payrolls.
That is the fourth highest job creation figure in the nation after
the New York, Dallas and Los Angeles metropolitan regions. On
a year-over-year percentage basis, job growth in the DC Metro
area is growing faster than in the New York, Los Angeles, Chicago,
San Francisco and Boston metropolitan regions. Moreover, officeusing employment has continued to expand, with over 35,000 jobs
created in office-using sectors since September of 2015, a level
only slightly below the typical combined annual office and nonoffice-using job creation figures in the Washington, DC region.
Indeed, one has to look back to mid-2010, prior to the time when
devastating effects of sequestration took hold in the region, to find
similar levels of office-using job creation. As has been the case
throughout 2016, Professional and Business Services employment
is leading job growth among all industry sectors, with 29,000 jobs
added to payrolls from September 2015 to September 2016. In
addition, positive job growththe likes of which the region hasnt
seen since early 2011has been particularly evident in the federal
government sector which added nearly 6,400 new payrolls from
September 2015 to September 2016.
MSF
We have the jobs...Now where is the Absorption?
05
06 07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%
cushmanwakefield.com | 3
Washington, DC
Economy
Job growth in metropolitan Washington, D.C. remained robust, with
the region, adding 85,200 net new jobs in the last 12 months -- more
than double the historical average. Locally, the Washington, D.C.
market added 14,600 net new jobs since August 2015, of which, 57%
were in office-using sectors. The federal government continued its
recovery after years of hiring freezes, adding 3,400 net new jobs
year-over-year, followed by professional and business services,
which added 3,400 net new jobs during the same period.
Market Overview
Market Indicators
3Q 15
3Q 16
12.0%
11.9%
Net Absorption
492k
108k
Under Construction
2.4 M
4.2 M
Overall Vacancy
Deliveries
Average Asking Rent
478K
284K
$51.18
$51.93
12-Month
Forecast
Overall Net Absorption/Overall Asking Rent

District of Columbia, 4Q Trailing Average
Despite healthy job growth, the Washington, D.C. office market

continued to face headwinds throughout the third quarter of 2016.
With only a handful of leases greater than 100,000 square feet
12
$53.00
10
$52.00
(SF), year-to-date new leasing activity closed the third quarter

at 3.2 million square feet (MSF), significantly below the 10-year
historical average of 4.2 MSF. The largest new lease of the quarter
was executed by FTI Consulting, which signed a 93,507-SF lease
to relocate to 555 12th Street, NW. Federal leasing was active
in the third quarter, although primarily as a result of short-term
renewals. One notable exception was the lease signed by the
General Services Administration (GSA) on behalf of the Bureau of
Alcohol, Tobacco, Firearms and Explosives, which committed to
take 34,719 SF at 90 K Street, NE, allowing the agency to be closer
to its headquarters in NoMa.
$51.00
With compressed leasing activity throughout the year, and with

few tenants in growth mode, year-to-date net absorption closed
the third quarter of 2016 at 580,677 SF. However, net absorption
was not evenly distributed. As tenants have remained focused
on a flight-to-quality, the Class C market experienced 251,152 SF
of negative absorption year-to-date. The East End has also been
impacted by distress in the legal sector and tenants relocations to
new and renovated properties in the CBD. Law firm Dentons is the
most recent example, vacating 1301 K Street, NW to consolidate
operations at 1900 K Street, NW, the former home of firm McKenna
Long & Aldridge LLP, which merged with Dentons in June 2015.
This move contributed to the 212,701 SF of negative absorption
in East Ends Class A market. Despite imbalanced net absorption,
overall vacancy rates held flat, closing the third quarter at 11.9%.
Overall asking rents ended the quarter at $51.93 per square foot, a
1.5% increase year- over- year.
$50.00
$49.00
2
0
$48.00
-2
$47.00
-4
2011
SF expected to be signed in the next three to six months, and

Novembers presidential election, which will spur new federal
leasing activity in 2017, the Washington, D.C. market is poised for
tightening fundamentals over the next 12 to 18 months. As job
growth remains well above historical averages, net new demand
is expected to trickle into the market as tenants look to expand in
order to accommodate their growing workforce.
2014
2015
Q3 16
$46.00
Asking Rent, $ PSF
Overall Vacancy Rate

16%
14%
12%
10%
2011
2012
2013
2014
2015
Q3 16
New Leasing Activity

8
7.3
6.8
7
5.9
5.8
5.2
Millions
With a handful of large, private-sector leases greater than 100,000
2013
Net Absorption, MSF
Outlook
2012
4.8
4.5
5.2
4.7
3.3
2.9
3
2
1
0
06
Capitol Hill/NoMa
07
08
East End
09
CBD
10
11
West End/Georgetown
12
Uptown
13
14
Southwest
15
YTD'16
Capitol Riverfront
Washington, DCDC
Submarkets
Washington,
Submarkets
NORTHEAST
UPTOWN
WEST END/
GEORGETOWN
50
CBD
EAST END
NOMA
29
CAPITOL HILL
66
50
395
DI
ST
RIC
T
VIR OF
GI CO
L
NI
A UM
395
SOUTHWEST
BI
A
395
395
CAPITOL RIVERFRONT/
SOUTHEAST
295
Top Transactions
Key Lease Transactions 3Q 2016
PROPERTY
SF
TENANT
TRANSACTION TYPE
SUBMARKET
1100 L Street, NW
217,000
GSA Department of Justice
Renewal / Relocation
East End
555 12th Street, NW
93,507
FTI Consulting
Relocation
East End
2001 K Street, NW
62,375
Paul, Weiss, Rifkind, Wharton & Garrison LLP
Renewal / Expansion
CBD
2201 Wisconsin Avenue, NW
45,043
MakeOffices
New Lease
Uptown
2001 K Street, NW
42,672
Cornerstone Research
Relocation
CBD
Key Sales Transactions 3Q 2016

PROPERTY
SF
SELLER/BUYER
PRICE
SUBMARKET
1100 First Street, NE
347,608
Rockefeller Group JV Mitsubishi Estate New York/Unizo
$217,500,000
Capitol Hill/NoMa
820 First Street, NE
298,533
Harbor Group International/Unizo
$140,500,000
Capitol Hill/NoMa
1 Thomas Circle, NW
238,444
Polinger JV GE Asset Management/LaSalle Investment Management
$115,000,000
East End
50 F Street, NW
212,780
Normandy Real Estate Partners/Unizo
$109,500,000
Capitol Hill/NoMa
Washington, DC Office Market
Washington, DC Office Market
12%
MSF
8%
1
4%
MSF
16%
Vacancy Rate
Inventory by Class, Third Quarter 2016

400
21%
350
19%
300
17%
250
15%
200
13%
150
11%
100
9%
50
7%
-1
05
06
07 08 09
Net Absorption
10 11 12
Deliveries
13 14 15
Vacancy Rate
16
0%
Capitol Hill/ East End

NoMa
Class A
Class B
CBD
West End/ Uptown

Georgetown
Class C
Vacancy %
Southwest
Capitol
Riverfront
Vacancy Rate
Net Absorption - Deliveries - Vacancy, Third Quarter 2016
5%
DC Overall Vacancy
Core (CBD/East End)

CBD
Market Indicators
Vacancy
9.8%
Net Absorption
Under Construction
135,900 SF
1,227,700 SF
Asking Rent
Deliveries
$54.10 FS
717,900 SF
*Arrows = Current Qtr Trend
1.0
16%
0.5
12%
0.0
8%
-0.5
4%
-1.0
expected to sign leases in the next three to six months will help
give a boost to new leasing activity in the four quarter 2016 and
first quarter 2017.
Despite banner year-to-date regional job growth in both 2015 and

2016 nearly double the historical average for the Washington,
D.C. metropolitan region market absorption trends have yet to
catch on. Tenants have continued to increase their densification
of employees. New construction options which tenants
continue to chase afford them with more efficient floor plates.
Combined with peak concession levels, tenants continue to be
able to take advantage of minimal move costs in newer, higherquality buildings, for nearly the same net effective rent in a
smaller footprints. For some tenants, however, they may find their
space needs to be too efficient, requiring expensive (and in some
cases non-contiguous) expansions. Other firms, however, have
been able to rectify their space requirements prior to build-out.
Law firm Venable, for example, has expanded by approximately
40,000 SF prior to relocating at 600 Massachusetts Avenue, NW
once that project delivers.
The East End closed the third quarter 2016 with negative 97,047
SF of year-to-date net absorption marking the first year since
2013 that the East End has experienced negative absorption.
That was primarily the result law firms Miller & Chevalier vacating
06
07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%
New Leasing Activity (CBD)

3.50
3.00
MSF
2.50
2.00
1.50
1.00
0.50
0.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Q1
Q2
Q3
Q4
Asking Rent (CBD)

$70
$65
Full Service PSF
The largest private-sector lease of the quarter was signed by

AARP, which took 105,562 SF of short-term expansion and swing
space at 650 Massachusetts Avenue, NW backfilling the space
formerly occupied by Blackboard, Inc. which relocated to 1111 19th
Street, NW in the CBD. FTI Consulting signed a long-term lease
at 555 12th Street, NW, which will relocate the firm from 1101 K
Street, NW. Paul, Weiss, Rifkind, Wharton & Garrison signed a
renewal and expansion at 2001 K Street, NW, which is the existing
portion of the currently-under-construction Alexander Court.
Cornerstone Research signed a 42,672-SF lease in anticipation of
its relocation to the northern portion of Alexander Court once the
project delivers in the first quarter of 2018.
05
Vacancy Rate
Net Absorption Deliveries Vacancy (CBD)
MSF
The Washington, D.C. market continued to face headwinds

through the third quarter of 2016, particularly as year-to-date new
leasing activity remained suppressed down 357 basis points
(BP) year over year since third quarter 2015. As a result of few
large, near-term lease expirations that have yet to be spoken for
through 2018, the bulk of new leasing activity has been driven by
small and mid-sized tenants less than 60,000 square feet (SF). Of
the total 3.3 million square feet (MSF) of year-to-date new leasing
activity, the core (CBD and East End) market comprised 65.4%.
With the pending law firm leases expected to sign in the CBD,
the core market is expected to claim an even higher percentage
of leasing activity by year end. The handful of law firm tenants
with requirements greater than 100,000 square feet (SF) that are
$60
$55
$50
$45
$40
$35
2009
2010
2011
Class A
2012
2013
2014
2015
2016
Class B, $ PSF
Core (Continued...)
East End
Market Indicators
Vacancy
11.9%
Net Absorption
Under Construction
Deliveries
Asking Rent
(130,400 SF)
1,228,090 SF
0 SF
$56.03 FS
Net Absorption Deliveries Vacancy (East End)
1.5
0.5
8%
0.0
4%
-0.5
-1.0
05
06
07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%
New Leasing Activity (East End)

3.50
3.00
MSF
2.50
2.00
1.50
1.00
Outlook
0.50
0.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Q1
Q2
Q3
Q4
Asking Rent (East End)

$65
$60
Full Service PSF
With the redevelopment boom kicking off in the CBD, the

core market is expected to become more bifurcated. Tenants
will continue to chase new construction as concessions
remain at peak levels, allowing tenants to relocate with
minimal-cost moves. For those larger displaced from Class
B and C assets slated for redevelopment, tenants face
increasingly limited options. That will continue to drive
Class B concessions back to near pre-recession levels.
Class B concessions have declined by nearly 25.0% since
year-end 2015. With a plethora of new options expected to
deliver in the core market over the next three years, asking
rents will continue to register suppressed growth, while
concessions will hold near current levels within the Class A
market. Overall, core asking rents have continued to hold
steady, posting a 6.6% increase over the last five years and
closing the third quarter 2016 at $56.28 PSF. However, with
the bulk of law firm consolidations completed, and small
and mid-sized tenants continuing to chip away at large
blocks of availability, the core market will continue to seeing
tightening vacancy. That will eventually lead to declining
concessions and increased rent growth.
12%
1.0
Overall, tenants remain focused on quality, top-tier assets, and

landlords particularly those in the CBD are looking to capitalize
on them through the redevelopment of their existing Class B and
C assets. JBG has filed for demolition permits of 1920 N Street,
NW, which will allow the developer to kick off its proposed Trophy
asset known as 1900 N Street, NW. Other development has
already started in the CBD. Tishman Speyer has begun site work
on the future home of CBS Radio, which will allow the developer
to kick-off its 2050 M Street, NW project once the media firm
relocates. The developer is also nearing completion of its 900
19th Street, NW renovation, which added additional floors, new
systems and amenities, and a glass curtain-wall faade to the
previously Class B building.
16%
Vacancy Rate
2.0
MSF
655 15th Street, NW for the newly delivered 900 16th Street,
NW in the CBD, and from Dentons having vacated 1301 K Street,
NW for 1900 K Street, NW in the CBD following its merger with
McKenna Long & Aldridge in 2015. Additional out-of-market
vacancies are expected to hit the market over the next 18 to 24
months, particularly from federal government tenants, which are
increasingly being priced out of the submarket due to the General
Services Administrations (GSA) price cap of $50.00 per square
foot (PSF).
$55
$50
$45
$40
$35
2009
2010
2011
Class A
2012
2013
2014
2015
2016
Class B, $ PSF
Non-Core
Vacancy
13.7%
Net Absorption
Under Construction
Deliveries
Asking Rent
103,000 SF
1,715,500 SF
620,900 SF
$46.48 FS
Although the Washington, DC Metropolitan Region continues to

experience unprecedented job growth across most sectors, the
leasing market remained fairly stagnant through the first three
quarters of 2016. Non-core submarkets accounted for just north
of 1 million square feet (MSF) of leasing activity at the conclusion
of the third quarter, nearly 35% of the gross leasing in the District
of Columbia year-to-date. If leasing continues at the pace of the
first three quarters of 2016, gross leasing for the combined noncore submarkets will be around 1.4 MSFslightly less than the
historical norm of 1.6 MSF million SF per year.
Of all the new leases signed in the non-core market in Q3 2016, only
two were from truly private-sector (non-government contractor)
companies: US Telecom (at 601 New Jersey Avenue, NW in Capitol
Hill/NoMa and MakeOffices (at 2201 Wisconsin Avenue, NW in
Uptown). Government contractor General Dynamics, signed two
separate deals; one at 80 M Street, SE for 14,990 SF and the other
at 101 Constitution Avenue, NW for 12,084 SF. The remaining
large leases within the non-core markets were for Washington,
DC government and GSA.
Net Absorption Deliveries Vacancy

3.5
24%
3.0
20%
2.5
16%
2.0
1.5
12%
1.0
8%
0.5
4%
0.0
-0.5
Vacancy Rate
MSF
Market Indicators
07
08
09
10
Net Absorption
11
12
Deliveries
13
14
15
Vacancy Rate
16
0%

3,000.00
2,500.00
2,000.00
THSF
The relative slowdown in leasing activity has resulted in lackluster

net absorption in Q3 2016. Non-core submarkets registered
359,100 SF of positive net absorption in the quarter, 48% off
the level of absorption in the third quarter of 2015. Although
Washington, DC continues to be a small-tenant town, every
year the market tends to attract some larger tenants that would
normally move the needle on vacancy and absorption in any given
market. So far, 2016 has not reflected that experience, especially
within the non-core submarkets. A few larger deals over 50,000
SF can have a profound impact for some of the emerging markets
like NoMa and Capitol Riverfront/Southwest that have had large
blocks of space available after the 2009 influx of new product as
well as current spec development.
1,500.00
1,000.00
500.00
0.00
2007
2008
2009
2010
Q1
2011
Q2
2012
Q3
2013
2014
2015
2016
Q4
Asking Rent
$60
Outlook
Overall, the diverse tenant base of the non-core market,
and new, class A developments particularly those in the
emerging markets of Capitol Hill/NoMa, Capitol Riverfront,
and Southwest will continue to attract tenants in both
the private and public sectors who are seeking non-core
pricing in amenity-rich locations.
Full Service PSF
$55
$50
$45
$40
$35
2009
2010
2011
A
2012
2013
2014
2015
2016
West End/Georgetown/Uptown
West End
Market Indicators
Vacancy
11.1%
Net Absorption
Under Construction
Deliveries
Asking Rent
14,800 SF
0 SF
0 SF
$47.13 FS
Net Absorption Deliveries Vacancy (WE/Gtown)

0.5
20%
12%
0.0
8%
4%
-0.5
05
currently surrounded by a number of new developments that are

helping re-energize the West End, and which will have a profound
impact on the market as more residents decide to live in the area.
06
07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%
New Leasing Activity (WE/Gtown)

0.60
0.50
0.40
MSF
The Uptown submarket has experienced a fair amount of attention

from tenants over the last few quarters and has registered over
109,000 SF of positive absorption year-to-date. The demand is
in large part due to the delivery of Douglas Developments new
project at Manhattan Laundry on Florida Avenue, NW. WeWork
preleased over 50,000 SF at the development that ultimately
delivered 76% leased in October. The largest deal within the
Uptown submarket during Q3 2016 was MakeOffices lease for
45,000 SF at 2201 Wisconsin Avenue, NW. The co-working
company continues to expand quickly in the District of Columbia.
In the second quarter of 2016, it signed a large lease at the world
class development, The Wharf. Vacancy in the Uptown submarket
closed Q3 2016 at 19.9%, an increase of 0.5 percentage points
from Q2 2016, and a 3.6 percentage point decline from the third
quarter of 2015.
Vacancy Rate
16%
MSF
The West End/Georgetown submarket is one of the tightest

vacancy submarkets in all of Washington, DC. Vacancy declined
0.3 percentage points over the third quarter of 2016, from 11.4%
to 11.1%. Demand was slower than usual, with the submarket
registering only 2,255 SF of positive absorption through the first
three quarters of 2016 and only 14,800 SF for Q3 2016 alone.
The submarket continues to experience less-than-stellar leasing
activity. That is not necessarily all bad news: only 489,000 SF of
prime space is being offered on the market, and 2300 N Street,
NW alone accounts for over half of the available space. That
project, in the heart of the West End, was vacated by Pillsbury
Winthrop Pittman Shaw when it opted for new development in
the CBD, and has been vacant for over two years. The location is
0.30
0.20
0.10
0.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Q1 Q2 Q3 Q4
Asking Rent (WE/Gtown)

$68
The West End appears to be experiencing a renaissance as

several new development projects are set to change the
landscape of the commercial market and reinvigorate the
area. Of note are: the redevelopment and repurposing of
1255 22nd Street, NW into a multifamily (MF) project; 2501
M Street, NW which is adding 60 Class A MF units and is
rumored to have signed Nobu as the high-end retail tenant;
EastBancs projects on Squares 37 and 50 which will bring
over 250 MF units, a 21,000 SF library, 10,000 SF of retail
space, a fire station, and a squash club.
$63
Full Service PSF
Outlook
$58
$53
$48
$43
$38
$33
2009
2010
2011
Class A
2012
2013
2014
2015
2016
Class B, $ PSF
Capitol Hill/NoMa
Net Absorption
Under Construction
Deliveries
Asking Rent
45,600 SF
1,288,100 SF
196,700 SF
$50.32 FS
Capitol Hill/NoMa ended Q3 2016 with only 45,600 SF of positive

absorption, well below the average quarterly demand of 117,300
SF. Currently, the submarket is on pace to post the lowest demand
figures since 2012, although vacancy actually decreased by 0.4
percentage points over the quarter. Year-over-year, vacancy has
increased from 12.2% to 12.9%, due to 660 North Capitol Street,
NW delivering with one prelease.
This emerging market has traditionally been an option for some
lower cost alternatives to the downtown core markets of the CBD
and East End, and Capitol Hill/NoMa continues to be a hub for
District of Columbia and federal government tenants. The top
three largest leases for the quarter were for Washington, DC
government tenants, all located in NoMa. The largest private
sector lease for the quarter was that of Fox News. The news and
television channel renewed for nearly 42,000 SF at the Hall of
States building at 400-444 North Capitol Street, NW. Proximity
to Capitol Hill continues to play a large factor in tenants decisions,
and the renewal solidifies the desire of one of the largest tenants
in the market of a long-term deal.
The overall asking rental rate for space in Capitol Hill/NoMa
increased by 1.2% over the quarter, from $49.75 per square
foot (PSF) on a full service basis to $50.32 PSF. The increase
represents a 5.23% increase year-over-year for the entire
submarket. The increase is in large part due to large blocks of
quality space coming online in the submarket and the delivery of
660 North Capitol Street, NW which is asking rents in the upper
$40s NNN range.

24%
2.0
20%
16%
1.0
12%
8%
0.0
Vacancy Rate
Vacancy
12.9%
MSF
4%
-1.0
05
06
07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%

1.40
1.20
1.00
MSF
Market Indicators
0.80
0.60
0.40
0.20
0.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Capitol Crossing, one of the largest mixed-use developments

in the region, continues to work on the speculative contruction
at 200 Massachusetts Avenue, NW. The building is currently six
floors above grade and the platform is near completion.
Q1
Q2
Q3
Q4
Asking Rent
$65
Outlook
As the election approaches, the Capitol Hill/NoMa
market could see decision-making at a standstill, as
many of the lobbying, public policy and government
affairs offices will wait to see the election results.
While there is no true correlation between leasing
activity and election cycles, many of the decision
makers may view the 2016 election differently than
those of the past. A periodic slowdown in leasing
activity may occur through November, especially in
the small tenant market of Capitol Hill.
$60
Full Service PSF
$55
$50
$45
$40
$35
2009
2010
2011
Class A
2012
2013
2014
2015
2016
Class B, $ PSF
Southwest/Capitol Riverfront
Vacancy
13.5%
Net Absorption
Under Construction
(21,900 SF)
427,400 SF
The Capitol Riverfront/Southwest submarket continued to

be dominated by deals from federal and District of Columbia
government tenants and the contractors that support government
agencies located south of the National Mall. Of the largest five
direct leases signed in the third quarter of 2016, three were for
Washington, DC government offices and totaled 85,300 SF, one
was for the GSA (federal government) for 34,100 SF, and one was
signed by government contractor General Dynamics for 15,000
SF. The top renewals were those of Alion Science and Technology
for 45,000 SF and Booz Allen Hamilton for 30,200 SF. This
leasing activity did not really have an impact on absorption. After
posting strong demand in the first half of the year, the submarket
took a slight step back in Q3 2016, with the combined submarket
registering 21,900 SF of negative net absorption for the quarter.
Year-to-date absorption still totals 191,800 SF which is relatively
flat for the emerging market along the riverfront that historically
absorbs 362,000 SF per year.
Deliveries
Asking Rent
341,300 SF
$46.48 FS

1.5
28%
24%
20%
16%
0.5
12%
8%
Vacancy Rate
MSF
Market Indicators
4%
-0.5
05
06
07
08
09
10
Net Absorption
11
12
13
Deliveries
14
15
16
0%
Vacancy Rate

1.80
1.60
1.40
1.20
MSF
Lackluster absorption numbers have been overshadowed by

the development of numerous top-class apartment buildings
throughout the Capitol Riverfront submarket. Many developers
are marketing land sites as for-rent residential product as the area
becomes increasingly more amenitized. Redbrick LMD purchased
the former Coast Guard Building at 2100 2nd Street, SW with
plans to redevelop the property into apartments. The Coast Guard
originally vacated the property to go to their newly developed
campus at St. Elizabeths. With repurposing the likely outcome,
the property was removed from inventory resulting in a slight
uptick in vacancy to 13.5% for the Capitol Riverfront/Southwest
submarket. The submarket continues to be unpredictable and
activity from the private sector is targeted. Some developments
such as 99 M Street, SE and The Wharf have attracted privatesector tenants, but other product in the combined submarket still
tends to garner the most attention from government tenants.
1.00
0.80
0.60
0.40
0.20
0.00
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Q1
Q2
Q3
Q4
Asking Rent
Outlook
The combined submarket also continues to be one of the
most active development locations across the Washington,
DC Metropolitan area. Many developers continue to vie
for new land in the submarket to take advantage of the
emerging market. Along with multifamily development
in the area around Nationals Park and along the Capitol
Riverfront, the development of The Wharf and Skanskas
99 M Street, SE is positioned attract new-found activity.
Full Service PSF
$55
$50
$45
$40
$35
2009
2010
2011
Class A
2012
2013
2014
2015
2016
Class B, $ PSF
Appendix
Table Summaries
Metro Washington Office
Market Summary
13
Employment Data
13
Office Availability, Vacancy,
and Net Absorption
14
Metro Washington Office Market Summary: Third Quarter 2016p

Inventory
Total Vacant
Space
Vacancy
Rate
Q3 2016
Absorption
Year to Date
Absorption
Washington, DC
108,620,109
12,919,188
11.9%
108,557
580,677
Northern Virginia
130,524,599
27,572,227
21.1%
442,988
442,988
Suburban Maryland
56,596,533
12,005,453
21.2%
-7,974
232,508
Regional Totals
295,741,241
52,496,868
17.8%
543,571
1,256,173
Trailing 12-Month Data

15
Historical Year-End Data
16
Metro Washington Current Employment Data

Non Farm
Employment
(Jan-Sep 2015)
Non Farm
Employment
(Jan-Sep 2016p)
Jobs Added/
Lost*
Percent Change
Washington, DC
765,856
776,911
11,055
1.4%
Northern Virginia
1,399,311
1,430,522
31,211
2.2%
973,522
996,444
22,922
2.4%
3,161,722
3,235,644
73,922
2.3%
Market Statistics by Class

17-18
Survey of New Office Space
by Submarket
19-22
Methodology & Definitions
23
Suburban Maryland
Regional Totals
SOURCE: U.S. Bureau of Labor Statistics (Not seasonally adjusted)

* Average per year to date
p - preliminary
37,277,737
5,097,432
13,603,173
10,931,247
4,074,326
4,153,673
108,620,109
East End
West End/
Georgetown
Capitol Hill/NoMa
Southwest
Capitol Riverfront/
Southeast
Uptown
TOTAL
p - preliminary
33,482,521
CBD
Total
Inventory
11,968,231
796,303
568,660
1,413,750
1,742,191
488,962
4,045,983
2,912,382
New/
Relet Space
Vacant
950,957
29,691
22,687
26,890
15,186
77,817
404,171
374,515
Sublet Space
Vacant
12,919,188
825,994
591,347
1,440,640
1,757,377
566,779
4,450,154
3,286,897
Total Space
Vacant
11.9%
19.9%
14.5%
13.2%
12.9%
11.1%
11.9%
9.8%
Vacancy Rate
(%)
Office Availability, Vacancy, and Net Absorption, Third Quarter 2016p
213,435
75,339
21,564
(36,874)
14,696
19,217
(65,978)
185,471
New/
Relet Space
Absorption
(104,878)
(10,645)
9,097
(15,726)
30,857
(4,463)
(64,449)
(49,549)
Sublet Space
Absorption
108,557
64,694
30,661
(52,600)
45,553
14,754
(130,427)
135,922
Total
Absorption
Appendix
37,686,959
5,097,432
13,249,755
10,667,091
4,674,326
4,014,207
108,447,228
East End
West End/
Georgetown
Capitol Hill/NoMa
Southwest
Capitol Riverfront/
Southeast
Uptown
TOTAL
p - preliminary
33,057,458
CBD
4th Qtr
2015
Trailing 12-Month Data
109,130,610
4,070,754
4,674,326
10,931,247
13,406,451
5,097,432
37,713,248
33,237,152
1st Qtr
2016
109,154,672
4,070,754
4,674,326
10,931,247
13,603,173
5,097,432
37,496,445
33,281,295
2nd Qtr
2016
Total Inventory
108,620,109
4,153,673
4,074,326
10,931,247
13,603,173
5,097,432
37,277,737
33,482,521
3rd Qtr
2016p
11.6%
23.2%
15.4%
10.8%
12.2%
11.2%
12.0%
9.3%
4th Qtr
2015
11.8%
19.6%
13.2%
13.9%
13.1%
10.9%
12.2%
9.1%
1st Qtr
2016
11.7%
19.4%
13.3%
11.9%
13.3%
11.4%
11.6%
9.8%
2nd Qtr
2016
Vacancy Rate (%)
11.9%
19.9%
14.5%
13.2%
12.9%
11.1%
11.9%
9.8%
3rd Qtr
2016p
501,971
13,085
23,326
15,596
(134)
11,555
253,698
184,845
4th Qtr
2015
(3,345)
38,711
104,401
(84,932)
(136,862)
15,803
(120,212)
179,746
1st Qtr
2016
475,465
6,387
(6,939)
147,108
146,573
(28,302)
153,592
57,046
2nd Qtr
2016
Total Absorption
108,557
64,694
30,661
(52,600)
45,553
14,754
(130,427)
135,922
3rd Qtr
2016p
Appendix
36,708,570
5,194,432
13,249,755
10,765,786
4,674,326
3,912,915
107,953,141
East End
West End/
Georgetown
Capitol Hill/NoMa
Southwest
Capitol Riverfront/
Southeast
Uptown
TOTAL
p - preliminary
33,447,357
CBD
2013
Historical Year-End Data
107,461,314
3,751,857
4,674,326
10,667,091
13,249,755
5,097,432
36,940,570
33,080,283
2014
108,447,228
4,014,207
4,674,326
10,667,091
13,249,755
5,097,432
37,686,959
33,057,458
2015
Total Inventory
108,620,109
4,153,673
4,074,326
10,931,247
13,603,173
5,097,432
37,277,737
33,482,521
2016p
14.4%
13.5%
17.1%
20.1%
15.5%
9.2%
13.2%
14.1%
2013
13.0%
22.6%
18.9%
17.2%
13.4%
12.2%
11.7%
11.2%
2014
11.6%
23.2%
15.4%
10.8%
12.2%
11.2%
12.0%
9.3%
2015
Vacancy Rate (%)
11.9%
19.9%
14.5%
13.2%
12.9%
11.1%
11.9%
9.8%
2016p
(29,475)
(48,155)
(20,648)
(251,582)
158,132
128,765
(40,940)
44,953
2013
962,536
(370,052)
(81,409)
232,425
153,842
(181,106)
487,410
721,426
2014
1,884,188
(28,187)
162,242
403,406
165,215
54,773
534,436
592,303
2015
Total Absorption
580,677
109,792
128,123
9,576
55,264
2,255
(97,047)
372,714
2016P
Appendix
Market Statistics
Washington, DC 3rd Quarter 2016 Market Statistics
Buildings
Total
Inventory
(SF)
New/Relet
Vacancy
(%)
Sublet
Vacancy
(%)
Total
Vacancy*
(%)
Net
Absorption
Current QTR
(SF)
Under
Construction
(SF)
Average
Asking Rent
(FS)
51
12,961,984
10.0%
0.9%
10.8%
73,378
1,227,659
$64.27
57
10,892,731
7.8%
1.0%
8.8%
53,556
$48.67
77
9,627,806
7.9%
1.7%
9.6%
8,988
$42.88
TOTAL
182
33,482,521
8.7%
0.6%
9.8%
135,922
1,227,659
$54.10
74
22,299,997
10.4%
1.3%
11.7%
(183,206)
1,228,090
$60.52
41
8,809,718
13.7%
0.9%
14.6%
162,502
$56.50
43
6,168,022
8.4%
0.7%
9.1%
(109,723)
$43.71
TOTAL
158
37,277,737
10.9%
0.6%
11.9%
(130,427)
1,228,090
$56.03
CBD
Class
East End
Class
West End/Georgetown
Class
A
1,437,437
21.5%
0.8%
22.3%
4,938
$49.50
10
1,938,420
7.5%
3.0%
10.5%
(1,701)
$44.13
14
1,721,575
2.0%
0.5%
2.4%
11,517
$40.81
TOTAL
31
5,097,432
9.6%
0.6%
11.1%
14,754
$44.68
23
7,204,305
14.9%
0.1%
15.0%
64,814
1,288,086
$62.19
18
5,122,825
10.0%
0.1%
10.1%
(21,690)
$47.10
11
1,276,043
12.4%
0.0%
12.4%
2,429
$25.76
TOTAL
19
13,603,173
12.8%
0.6%
12.9%
45,553
1,288,086
$50.32
19
8,188,245
11.7%
0.2%
11.9%
(50,375)
211,787
$50.72
1,593,948
19.3%
0.7%
20.0%
(738)
$45.60
1,149,054
12.7%
0.0%
12.7%
(1,487)
$46.85
TOTAL
31
10,931,247
12.9%
0.6%
13.2%
(52,600)
211,787
$48.14
Capitol Hill
Class
Southwest
Class
* Total Vacancy - the vacancy rate is calculated using the combined total of relet, sublet and new vacant space.
Market Statistics
Washington, DC 3rd Quarter 2016 Market Statistics
Buildings
Total
Inventory
(SF)
New/Relet
Vacancy
(%)
Sublet
Vacancy
(%)
Total
Vacancy*
(%)
Net
Absorption
Current QTR
(SF)
Under
Construction
(SF)
Average
Asking Rent
(FS)
Capitol Riverfront
Class
A
10
3,596,764
9.8%
0.6%
10.4%
30,661
215,616
$45.38
0.0%
0.0%
0.0%
$0.00
477,562
45.4%
0.0%
45.4%
$39.00
TOTAL
12
4,074,326
14.0%
0.6%
14.5%
30,661
215,616
$42.04
367,832
0.5%
1.9%
2.4%
1,624
$46.00
2,011,558
31.7%
0.0%
31.8%
99,248
$42.97
21
1,774,283
8.8%
1.2%
10.0%
(36,178)
$37.65
TOTAL
31
4,153,673
19.2%
0.6%
19.9%
64,694
$41.99
Uptown
Class
Washington, DC
Class
A
186
56,056,564
11.2%
0.8%
12.1%
(58,166)
4,171,238
$59.89
142
30,369,200
12.1%
0.9%
12.9%
291,177
$49.77
174
22,194,345
9.0%
1.0%
10.0%
(124,454)
$41.07
TOTAL
502
108,620,109
9.2%
0.6%
11.9%
108,557
4,171,238
$51.93
* Total Vacancy - the vacancy rate is calculated using the combined total of relet, sublet and new vacant space.
Skanska USA
2112 Pennsylvania Avenue, NW
N/A
Tishman Speyer / Farragut

Development Co
2000 K Street, NW
TA Realty / Robert C Elder Associate $71.00 - $80.00 FS

Douglas Development Corporation
Gould Property Company
1333 H Street, NW
1000 F Street, NW
600 Massachusetts Avenue, NW
FS
N
U/C = Under Construction
U/R = Under Renovation

NNN = Net of all Operating Expenses and Taxes
= Plus Electric NT = Plus Taxes
= Full Service NN = Plus Electric & Char
Operating Expense and Real Estate Tax Base
Low to Mid $50's NNN
$55.00-$65.00 NNN
Status
Total
655 New York Avenue, NW
$80.00 - $90.00 FS
OWNER/DEVELOPER
BUILDING ADDRESS
East End
RENTAL RATE
$67.00 - $71.00 FS
Tishman Speyer / Oliver T Carr

Company
900 19th Street, NW
Total
N/A
Rockrose Development
Corporation/Spitzer Enterprises
N/A
N/A
RENTAL RATE
2001 K Street, NW (Alexander Court)
1100 15th Street, NW (Midtown Center Carr Properties

Fannie Mae)
OWNER/DEVELOPER
BUILDING ADDRESS
CBD
U/C
U/C
U/R
U/C
STATUS
U/R
U/R
U/C
U/R
U/C
STATUS
3Q16
4Q16
4Q16
4Q18
DELIVERY
DATE
2Q17
1Q17
4Q17
2Q18
1Q18
DELIVERY
DATE
1,493,174
401,172
86,114
265,084
740,804
RENTABLE
BUILDING
AREA
1,551,593
222,118
101,816
177,659
810,000
240,000
RENTABLE
BUILDING
AREA
Washington, DC Survey of Office Space Under Construction/Under Renovation
487,294
90,228
86,114
70,148
240,804
AVAILABLE
SPACE
669,996
222,118
101,816
177,659
43,000
125,403
AVAILABLE
SPACE
67%
78%
0%
74%
67%
PERCENT
PRELEASED
57%
0%
0%
0%
95%
48%
PERCENT
PRELEASED
Venable
N/A
N/A
Advisory Board
MAJOR TENANTS
N/A
N/A
Cornerstone Research
Fannie Mae
Cleary Gottlieb
MAJOR TENANTS

Eastbanc / Stanton Development
Property Group Partners
Property Group Partners
1140 3rd Street, NE
700 Pennsylvania Avenue, SE
FS
N
U/R = Under Renovation
4,760,256
TOTAL CURRENTLY UNDER

CONSTRUCTION/RENOVATION
Status
2,963,925
2018 DELIVERIES
U/C = Under Construction
869,961
AVAILABLE
SPACE
RENTABLE
BUILDING
AREA
2,765,460
1,582,328
806,944
376,188
364,386
215,616
148,770
AVAILABLE
SPACE
1,243,784
532,209
425,296
156,581
129,698
AVAILABLE
SPACE
427,403
215,616
211,787
RENTABLE
BUILDING
AREA
1,288,086
532,209
425,296
156,581
174,000
RENTABLE
BUILDING
AREA
2017 DELIVERIES
1Q18
3Q17
DELIVERY
DATE
3Q18
1Q18
2Q17
3Q16
DELIVERY
DATE
926,370
U/C
U/C
STATUS
U/C
U/C
U/C
U/C
STATUS
2016 DELIVERIES
Washington, DC Summary
Total
Mid to High $50's FS
Skanska
99 M Street, SE
RENTAL RATE
Mid to High $50's FS
OWNER/DEVELOPER
Withheld
Withheld
$65.00 - $73.00 FS
$56.00 - $61.00 FS
RENTAL RATE
The Wharf Phase 1- 800 Maine Avenue,

PN Hoffman / Madison Marquette
SW
BUILDING ADDRESS
Southwest/Capitol Riverfront/Southeast
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Capitol Hill/ NoMa
Washington, DC Survey of Office Space Under Construction/Under Renovation
42%
47%
7%
59%
PERCENT
PRELEASED
15%
0%
30%
PERCENT
PRELEASED
3%
0%
0%
0%
25%
PERCENT
PRELEASED
N/A
APA
MAJOR TENANTS
N/A
N/A
N/A
N/A
MAJOR TENANTS
Republic Properties Corporation
Brookfield Office Properties
The JBG Companies
Columbia Funding Corp
660 N Capitol Street, NW
2001 M Street, NW
900 16th Street, NW
500 D Street,SW (National Square
ASB Real Estate Investments / MRP

Realty, Inc
900 G Street, NW
FS
$47.00-$53.00 NNN
$53.50 NNN
RENTAL RATE
$50.00 - $55.00 FS
$81.00 - $83.00 FS
$70.00 - $80.00 FS
$69.00 - $76.00 FS
$53.00 - $66.00 FS
$61.00 FS
RENTAL RATE
East End
East End
SUBMARKET
Southwest
East End
CBD
Capitol Hill
CBD
Uptown
SUBMARKET
577,295
104,541
472,754
RENTABLE
BUILDING
AREA
1,210,975
341,283
127,825
261,000
196,722
201,226
82,919
RENTABLE
BUILDING
AREA
69,551
14,654
54,897
NEW SPACE
AVAILABLE
824,959
341,283
28,380
145,681
119,801
173,485
16,329
NEW SPACE
AVAILABLE
*Vacancy rate for new office space- does not include relet or sublet space available
Delivered 1Q15
Boston Properties
Total
Delivered 3Q15
OWNER/DEVELOPER
STATUS
Delivered 1Q16
Delivered 1Q16
Delivered 2Q16
BUILDING ADDRESS
2015 Deliveries
Total
Delivered 3Q16
RREEF / Prudential Property

Company
1800 K Street, NW
Delivered 2Q16
Delivered 3Q16
1328-1346 Florida Avenue, NW

(Manhattan Laundry)
STATUS
OWNER/DEVELOPER
BUILDING ADDRESS
2016 Deliveries
Washington, DC Survey of New Office Space
12%
14%
12%
VACANCY RATE (AS OF

CURRENT QUARTER)*
68%
100%
22%
56%
61%
86%
20%
VACANCY RATE (AS OF

CURRENT QUARTER)*
40%
84%
PERCENT LEASED UPON DELIVERY
0%
78%
18%
38%
14%
80%
Furioso Development
Perseus Realty
Brookfield Office Properties
Akridge
Hines
Union Investments
Hines
1525 14th Street, NW
799 9th Street, NW
AAMC
655 K Street, NW
600 13th Street, NW
CityCenter DC
North and South Towers
800/850 10th Street, NW
$46.50 FS
N/A
RENTAL RATE
Withheld
$36.00-$47.00 NNN
Renovation
Low-Mid $40's FS
Completed 2Q13
Delivered 1Q13
First Potomac Realty Trust / The

Lenkin Company Management
Angelo Gordon / Monument Realty /

Verizon Communications
440 1st Street, NW
Wonder Bread Building

641 S Street, NW
2055 L Street, NW
FS
Renovation
$53.00-$62.00 FS
Completed 3Q13
Carr Properties
1700 New York Avenue, NW
Arch Square
801-803 7th Street, NW
Total
Delivered 4Q13
Trammell Crow Company
N/A
N/A
$55.00 NNN
$52.00-$55.00 FS
East End
CBD
Uptown
Capitol Hill
CBD
NoMa
NoMa
SUBMARKET
East End
East End
East End
CBD
East End
Uptown
Uptown
SUBMARKET
0
315,816
25,000
26,292
289,524
NEW SPACE
AVAILABLE
98,344
1,328
19,326
19,996
20,948
36,746
NEW SPACE
AVAILABLE
1,145,399
126,760
81,633
137,495
121,987
289,524
363,000
RENTABLE
BUILDING
AREA
1,473,976
531,652
221,659
273,454
168,837
204,025
27,761
46,588
RENTABLE
BUILDING
AREA
*Vacancy rate for new office space- does not include relet or sublet space available
Delivered 1Q13
Delivered 4Q13
$30.00's NNN
Sentinel Square Phase II

1050 1st Street, NE
Delivered 4Q13
StonebridgeCarras
Three Constitution Square

175 N Street, NE
RENTAL RATE
$50.00-$57.00 NNN
OWNER/DEVELOPER
STATUS
Delivered 1Q14
Renovation
$44.00-$48.00 NNN
Completed 1Q14
Delivered 2Q14
Delivered 3Q14
Renovation
$48.00-$54.00 NNN
Completed 3Q14
Delivered 3Q14
Delivered 4Q14
STATUS
BUILDING ADDRESS
2013 Deliveries
Total
OWNER/DEVELOPER
BUILDING ADDRESS
2014 Deliveries
Washington, DC Survey of New Office Space
28%
0%
0%
0%
19%
0%
100%
0%
VACANCY RATE (AS OF

CURRENT QUARTER)*
7%
0%
9%
7%
12%
18%
0%
0%
VACANCY RATE (AS OF

CURRENT QUARTER)*
76%
74%
0%
14%
78%
0%
0%
97%
85%
79%
60%
73%
100%
100%
Methodology & Definitions

Methodology
Explanation of Terms
Market statistics are calculated

from a base building inventory
made up of office properties
deemed to be competitive in the
typical Washington, DC office
market. Single-tenant buildings and
privately-owned buildings in which
the federal government leases space
are included.
Generally, owneroccupied
and
federally-owned
buildings are not included. Older
buildings unfit for occupancy or ones
that require substantial renovation
before
tenancy
are
generally
not included in the competitive
inventory. Vacant space is defined
as space that is physically vacant and
available immediately. Sublet space
still occupied by the tenant is not
counted as vacant space.
Total Inventory: The total amount

of office space (in buildings greater
than 10,000 square feet) that can be
rented by a Fourth party.
New Space Vacant: First generation,
never-occupied office space in
newly constructed or substantially
renovated buildings, being actively
marketed by a landlord.
Relet
Space
Vacant:
Secondgeneration,
unoccupied
office
space being actively marketed by a
landlord. (Space that is marketed but
largely occupied is not counted as
vacant space.)
Sublet Space Vacant: Secondgeneration, unoccupied space being
actively marketed by a tenant.
(Sublet space that is marketed but
still occupied is not counted as
vacant space.)
Total Space Vacant: The sum of
new, relet, and sublet space that
is unoccupied and being actively
marketed.
Vacancy Rate: The amount of
unoccupied space (new, relet, and
sublet) expressed as a percentage of
total inventory. (Total Space Vacant
divided by Total Inventory.)
Total Space Available: The total

amount of space, both vacant and
occupied, being actively marketed
for lease by a tenant or landlord.
(This includes space that is currently
occupied but marketed for future
availability.)
Availability Rate: The total amount
of space being actively marketed for
lease (both vacant and occupied)
expressed as a percentage of total
inventory. (Total Space Available
divided by Total Inventory.)
Absorption: The net change in
occupied space between two points
in time. (Total occupied space in the
previous quarter minus total occupied
space in the current quarter, quoted
on a net, not gross, basis.)
New/Relet/Sublet Absorption: The
net change in occupied new, relet,
and sublet space between two
quarters.
Total Absorption: The net change
in total occupied (new, relet, and
sublet) space between two quarters.
New Leasing Activity: The sum of
all square footage underlying any
leases between two quarters. This
includes pre-leasing activity as well
as expansion. It does not include
renewals.
Disclaimer
This report and other research materials may be found on our website at www.cushmanwakefield.com. This is a research
document of Cushman & Wakefield in Washington, DC. Questions related to information herein should be directed to the
Research Department at +1 202 463 2100. Information contained herein has been obtained from sources deemed reliable and
no representation is made as to the accuracy thereof.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and
live. Our 43,000 employees in more than 60 countries help investors and occupiers optimize the value of their real estate by
combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman
& Wakefield is among the largest commercial real estate services firms with revenue of $5 billion across core services of
agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset
management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more,
visit www.cushmanwakefield.com or follow @CushWake on Twitter.
Visit cushmanwakefield.com for more information on the full range of

Cushman & Wakefield commercial real estate services or contact:
Nathan Edwards
Regional Director
2101 L Street, NW, Suite 700
Washington, DC 20037
+1 202 463 2100
Summer Newman
Senior Research Analyst
+1 202 463 2100
Joseph Wood
Research Analyst
+1 202 463 2100
About Cushman & Wakefield

Cushman & Wakefield is a leading global real estate services firm that helps clients
transform the way people work, shop, and live. Our 43,000 employees in more than
60 countries help investors and occupiers optimize the value of their real estate by
combining our global perspective and deep local knowledge with an impressive
platform of real estate solutions. Cushman & Wakefield is among the largest
commercial real estate services firms with revenue of $5 billion across core services
of agency leasing, asset services, capital markets, facility services (C&W Services),
global occupier services, investment & asset management (DTZ Investors), project &
development services, tenant representation, and valuation & advisory. To learn more,
visit www.cushmanwakefield.com or follow @CushWake on Twitter.
Publication date: 6.2.16

Copyright 2016 Cushman & Wakefield. All rights reserved.
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Market Report

Washington, DC | 3rd Quarter 2016

DC Metropolitan Area Overview..............................................................................3

Cushman & Wakefield | 2

Washington, DC Metropolitan Area

While the narrative about job growthas well as the midterm

Average Asking Rent (FS)

Net Absorption/Asking Rent

Net Absorption, MSF

Asking Rent, $ PSF

Washington, DC Metropolitan Area

The Washington, DC metropolitan regions (DC Metro) economy

We have the jobs...Now where is the Absorption?

Overall Net Absorption/Overall Asking Rent

Despite healthy job growth, the Washington, D.C. office market

(SF), year-to-date new leasing activity closed the third quarter

With compressed leasing activity throughout the year, and with

SF expected to be signed in the next three to six months, and

Asking Rent, $ PSF

Overall Vacancy Rate

New Leasing Activity

With a handful of large, private-sector leases greater than 100,000

Net Absorption, MSF

Cushman & Wakefield | 4

GSA Department of Justice

555 12th Street, NW

Paul, Weiss, Rifkind, Wharton & Garrison LLP

2201 Wisconsin Avenue, NW

Key Sales Transactions 3Q 2016

1100 First Street, NE

Rockefeller Group JV Mitsubishi Estate New York/Unizo

820 First Street, NE

Harbor Group International/Unizo

Polinger JV GE Asset Management/LaSalle Investment Management

Normandy Real Estate Partners/Unizo

Washington, DC Office Market

Washington, DC Office Market

Inventory by Class, Third Quarter 2016

Capitol Hill/ East End

West End/ Uptown

Net Absorption - Deliveries - Vacancy, Third Quarter 2016

Cushman & Wakefield | 6

Core (CBD/East End)

*Arrows = Current Qtr Trend

Despite banner year-to-date regional job growth in both 2015 and

New Leasing Activity (CBD)

Asking Rent (CBD)

The largest private-sector lease of the quarter was signed by

Net Absorption Deliveries Vacancy (CBD)

The Washington, D.C. market continued to face headwinds

*Arrows = Current Qtr Trend

Net Absorption Deliveries Vacancy (East End)

New Leasing Activity (East End)

Asking Rent (East End)

With the redevelopment boom kicking off in the CBD, the

Overall, tenants remain focused on quality, top-tier assets, and

Cushman & Wakefield | 8

Although the Washington, DC Metropolitan Region continues to

Net Absorption Deliveries Vacancy

*Arrows = Current Qtr Trend

New Leasing Activity

The relative slowdown in leasing activity has resulted in lackluster

Full Service PSF