Associations and nonprofits are taking advantage of tenant-friendly market conditions, having leased nearly 1.1M SF in the first half of this year, more than any other six-month period since 2011, according to a report by real estate brokerage firm Savills Studley. Association leasing activity has already surpassed 2014 annual totals. Transactions include: National League of Cities and National Association of Counties’ lease of 81k SF at Republic Square II; the American Council of Life Insurers lease of 53k SF at 101 Constitution; and Edison Electric Institute renewing 77k SF at Market Square East (above).
Savills Studley co-regional manager Tom Fulcher says it continues to be a great market for tenants. How people work is changing dramatically. Spaces must support collaboration and getting natural light to all employees, not just senior people with window views. Organizations that don't have some of these modern standards are starting early discussions, way before their leases run out, on whether to invest in a makeover or move. One market to watch is DC’s Southwest neighborhood, where The Wharf and National Square are underway. The American Psychiatric Association recently announced it would be the first major employer to set up shop at the Southwest Waterfront, a $1.2B project that will have a luxury hotel, several restaurants and a 6,000-seat concert hall.
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