It’s no secret that the Federal Government is a main driver of office demand in the Washington, D.C. Metro region. Federal government agencies occupy over 100 million square feet (msf) of office space. Over 50% of the occupied space - 57 million square feet - is leased from private sector landlords throughout the District of Columbia, Northern Virginia and Suburban Maryland. Federal leases comprise 16% of the total DC Metro office inventory and half of the top lease transactions so far in 2014 were for federal users.
It’s also no secret that the federal government has been shedding jobs in a big way over the past three years. The federal government today has 21,000 fewer jobs than it had at peak federal employment levels in September of 2011. Currently, at 364,380 positions, the federal government is the same size now as it was at height of the Great Recession in the third quarter of 2009.
So, what’s the good news? Well, it appears that federal job losses are finally coming to an end. After months of decelerating losses in the federal sector, federal employment was up across the board in all three markets in August 2014 – up nearly 500 jobs in Suburban Maryland, up 600 in the District and up over 800 in Northern Virginia. Yes, we do still have a long road ahead to get back to peak federal employment levels, but these small gains, coupled with a noticeable uptick in federal lease activity over the past couple months, and over half the federal leased footprint rolling through 2018, have some people thinking the government might be on its way back. Stay tuned.
Source: GSA, Cassidy Turley
By: Nathan Edwards
Director of Research, Cassidy Turley - Washington, D.C.
Email Nathan: Nathan.Edwards@cassidyturley.com
Follow Cassidy Turley on Twitter: @CassidyTurleyRE
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