Seattle-Tacoma Office Market Report

Tenants in Seattle-Tacoma are projected to stay cautious this year. Vacancy will edge up 40 basis points to over 19 percent in 2025 as some tenants continue to evaluate space needs in a less hybrid environment; even so, a few bright spots exist. Apple’s lease at Arbor Blocks West capped off an active end to 2024, demonstrating that large users are still willing to commit. Nevertheless, a robust 5.1 million square feet set to deliver in 2025 — well above the historical average — will test market fundamentals. Legislative incentives spurring office-to-housing and office-to-lab conversions could shape future supply dynamics. Despite right-sizing among major tech firms, Seattle’s cluster of Fortune 500 headquarters and budding AI and satellite sectors remain long-term demand drivers. These trends, coupled with Amazon’s five-day in-office mandate, set the stage for a measured recovery, albeit one constrained by rent pressures and heightened competition from modern, amenity-rich properties on both sides of Lake Washington.