The Washington Metro Area’s Coworking Boom
As the Washington region’s office market steadily progresses through its recovery phase, one type of tenant in particular has become a significant source of demand. Since the beginning of 2016, operators of coworking space have signed over 300,000 SF worth of leases in the District of Columbia, Northern Virginia, and Suburban Maryland. The expanding amount of positive office space absorption from coworking operators has helped to offset the densification trends prevalent among the area’s traditional large office tenants, particularly in the federal and legal sectors.
One case that illustrates this perfectly is WeWork’s February lease of 117,000 SF at Metropolitan Square in the East End of the District—space that was previously occupied by law firm Miller & Chevalier. While coworking spaces still only occupy a very small percentage of the 312 million SF of rentable office inventory in the metro region, the Washington area is the 2nd most active market for coworking in the nation, after New York. Coworking spaces are especially desirable since they are often drawn to pricey Class A space in core markets and serve as incubators for the larger tech industry.
Looking ahead, the Washington coworking sector is certainly poised for major growth and will remain a major source of leasing activity in the coming years.