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It’s the moment you’ve all been waiting for: The third-quarter office vacancy numbers are out. And D.C. still has the lowest vacancy rate in the country.
I’ll take this opportunity to link to my predecessor’s thorough case for scrapping the Height Act, an argument she’s hardly alone in making. At the risk of lacking nuance, the argument, in a nutshell, goes like this: By capping the size of office buildings within District limits, the law holds down supply, drives up the cost of office space, and puts D.C. at a competitive disadvantage. D.C.’s continued low vacancy rate is evidence of the imbalance between supply and demand.
But I’d be remiss not to note that D.C.’s office vacancy rate is in fact rising, as the national vacancy rate shrinks. According to Reis Inc., which supplied the figures, office vacancies in the District have steadily crept upward since the second quarter of last year, from a rate of 9 percent at the time to 9.5 percent now. Reis blames “political deadlock and contracting government employment” for the decline.
Indeed, Congress is unusually deadlocked these days—-it’s even taken a toll on lobbying—-and about a million public-sector jobs have been lost since President Barack Obama took office. So it’s likely that the drop in office vacancy is a product of (hopefully) temporary circumstances rather than any sort of structural decline, and that the city will continue to face a crunch as long as the office supply remains limited.
Photo by Darrow Montgomery