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Market Report

Cincinnati Office Market Report

2023 Investment Forecast

Low Vacancy in Northern Kentucky Spreads to Cincinnati Proper;
Key Firms Grow Existing Footprints

Expansions backstop downtown office performance amid vacancy headwinds. Major companies like Great American Life Insurance — recently bought and rebranded to MassMutual Ascend — and Luma Financial are continuing to expand their core Cincinnati footprints, with both companies recently leasing additional floorplans in the CBD. These organizations’ willingness to invest further in the market is providing an additional boost to a downtown that already has a vacancy rate below most other national CBDs. Elsewhere, Cincinnati may attract companies looking to reduce operating costs this year, as the metro’s average asking rent ranks as the lowest among major U.S. markets at under $15 per square foot. Still, the metro is likely to face near-term challenges, as overall vacancy is projected to rise for a fourth consecutive year. This increase, however, will not be supply induced, as projects finalized during 2023 will increase office inventory by just 0.2 percent. The lack of upcoming completions should minimize competition for recently built properties with notable chunks of available space, and potentially aid Class A leasing velocity at a time when subsector vacancy is nearing 20 percent.
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