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Metro-accessible office product driving significant occupancy gains in Prince George’s County

• Vacancy for offices within half-a-mile of the Metro in Prince George’s County has dropped to its lowest point since 2011, falling from 33.9% in 2014 to 14.1% in Q1 2018. Meanwhile, vacancy among offices greater than half-a-mile from Metro in Prince George’s County has hovered above 20% in recent years.

• Aided in large part by 2U’s 300,000-s.f. relocation to 7900 Harkins Road and the planned conversion of 3700 East-West Highway to residential, developments within half-a-mile of Metro have seen close to 90,000 s.f. of occupancy gains since 2015. These positive occupancy gains for offices near the Metro are only expected to continue as Kaiser Permanente and the U.S. Department of Homeland Security – Citizenship and Immigration Services (CIS) will move into a combined 750,000 s.f. over the next 24 months, potentially pushing direct vacancy to around 10% for this area of the market.

• Occupancy gains at developments near transit have the potential to continue and attract large federal agencies, as these sites offer tenants high-quality office product served by multiple transit lines at almost half the price of new product currently underway in the emerging markets of Washington, DC where federal government presence is strong.

• As for office developments off of Metro, though vacancy has been elevated for an extended period, there have been positive signs of change. Planned and future conversions of largely vacant office buildings to other uses, such as what is currently being planned at 6009 Oxon Hill Road, will lower supply and thus have the potential to lower overall vacancy rates, through introducing a mixture of uses which will draw new amenities to the area and then subsequent commercial demand.


Source: JLL Research




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