Chelsea Drinkard No Comments

3rd Quarter 2025 Tampa Bay Office Market Report and Forecast

Economic Performance & Employment Trends:

  • Although Tampa Bay’s unemployment rate increased to 3.9% in Q3 and is up from 3.5% from Q3 2024. Still falls below the national rate of 4.3%.
  • “FloridaCommerce announced that the Tampa metro area added 16,400 jobs (+1.2%) in the private sector over the year in July 2025 and has exceeded the national rate for 50 of the last 52 months,” FloridaCommerce.
  • “The area gained the third-highest number of private sector jobs and led the metro areas in job gains over the year in July 2025 in manufacturing, adding 1,600 jobs. Industry gaining the most jobs over the year in the Tampa metro area was education and health services, adding 5,600 jobs” says FloridaCommerce. 
  • Inflation Rate was up 2.9% as of August 2025 over the past year via the US Bureau Labor Statistics. 

Key Metrics in the Office Market:

  • Tampa Bay’s average asking rents over all classes have climbed again and hit a record high,  Approx. 3.0% year-over-year, driven primarily by a 5% increase in Class A rates, compared to just a Approx. 2% bump for Class B assets. The pricing differential between urban and suburban Class A properties continues to widen.
  • Consistent with Q2, majority of leasing occurred in Class A buildings with over 65% of the activity, reflecting the preference of quality building by Tenants
  • Overall vacancy ended at +/- 18.9% with Class A buildings at +/- 14.6%
  • Q3 ended in positive absorption of +/- 200,000 SF, for the second consecutive quarter with a minimal negative absorption in Q1.

Let’s Talk Rent Numbers:

SubmarketOverall Average Asking Rent-All ClassesOverall Asking Rent Class A
Westshore$37.89 Sq. Ft.$43.88  Sq. Ft.
Downtown Tampa$43.13 Sq. Ft.$45.62 Sq. Ft.
Northwest Tampa$26.28 Sq. Ft.$27.56 Sq. Ft.
South Tampa$43.00 Sq. Ft.$52.00 Sq. Ft.
I-75 Corridor$25.78 Sq. Ft.$26.05 Sq. Ft.
Downtown St. Petersburg$41.02 Sq. Ft.$45.69 Sq. Ft.

New Construction Pipeline:

  • Midtown East: The first New Class A building built since 2021 which is 131,790 SF and the second phase of Midtown Tampa, mixed use project located in the heart of Tampa. Since its deliver, 60% vacancy remaining. Midtown East  delivery was part of the reason of the vacancy increase in Westshore during 2nd Qtr. which improved in the 3rd Qtr.
  • Ybor: 92,530 SF for Grow Financial in Ybor broke ground in 2nd quarter where Grow Financials new headquarters will be located from i-75 area.

2025 4th Quarter Forecast:

What does this mean for Tenants?

Advantages:

  • Companies who desire to be in suburban areas such as Northwest Tampa in near Hillsborough Avenue/ Veterans Expressway and Carrollwood and I-75 Corridor,  have more negotiating leverage on rental rate and lease concessions due to the higher vacancy rates in buildings.
  • Tenants in the 10,000 + Square Foot range have a stronger position across all Submarkets when negotiating with Landlords. Especially with the most notable leases in the 3rd quarter were 10,000 SF-25,000 SF

Challenges:

  • Every industry is different and every company is different when determining hybrid work schedules [if any]. Gaging top performing employees and where the most ideal employees you plan on recruiting live, will assist office site selection.
  • Class A rents across all submarket will continue to increase as supply tightens.
  • Companies who have part time or full time office policies and do not have their office among highly amenitized and quality buildings,  could negatively impact recruiting abilities for employees to seek more favorable location and atmosphere if they are required to be in office.

Considerations:

  • Due to low vacancy in a submarket like Tampa CBD, allow plenty of lead time before a lease ends is vital when considering a relocation or expansion.
  • Evaluating submarkets outside of Westshore or Tampa CBD, will provide more favorable rental rate and lease terms. 
  • If Tenants are finding themselves in place of uncertainty for their office space, Coworking solutions have become very common in Tampa Bay, providing a mix of individual offices and conference rooms to be used for monthly and quarterly meetings.
  • Tenants who want to subleasing their space, positioning the space below market rent and free rent will position the space to be the frontrunner with competitors. 

What does this mean for Landlords?

Opportunities:

  • Class A buildings are experiencing the most leasing activity. If a building is not Class A, consider adding features Tenants find valuable.
  •  Outlying areas such as Northwest Tampa and outside of Westshore and the CBDs, have the opportunity to capture Tenant’s who have been priced out.

Challenges:

  • Buildings located in suburban corridors like the Northwest and i-75 are experiencing the highest vacancy rates with companies minimizing their office footprints and focusing on prime locations.

Considerations:

  • Landlord’s in high vacancy areas, can offer additional incentives for Tenants with shorter lease terms, higher Tenant Improvement allowance and rent abatement to incentivize companies to consider a building and location they typically would not.
  • Frequency of office space use and operational layouts are being reimagined and repurposed, consider providing conference room space for Tenants who only need use of a conference room on a monthly or quarterly basis.
Chelsea Drinkard No Comments

2nd Quarter 2025 Tampa Bay Office Market Report and Forecast

Economic Economic Performance & Employment Trends:

Key Metrics in the Office Market:

  • Tampa’s average asking rents over all classes have edged up 2.3% year-over-year, driven primarily by a 4% increase in Class A rates, compared to just a 1% bump for Class B assets. The pricing differential between urban and suburban Class A properties continues to widen.
  • Majority of leasing activity occurred in Class A buildings in Tampa CBD, which was primarily responsible for vacancy compression
  • Overall vacancy ended at +/- 19.5% with Class A buildings at +/- 14.6%
  • Q2 ended in positive absorption of +/- 175,000 SF, up from the negative absorption in Q1 and one of the highest in the past 5 years.

Let’s Talk Rent Numbers:

SubmarketOverall Average Asking Rent-All ClassesOverall Asking Rent Class A
Westshore$36.00 Sq. Ft.$42.66 Sq. Ft.
Downtown Tampa$42.80 Sq. Ft.$45.40 Sq. Ft.
Northwest Tampa$26.57 Sq. Ft.$27.56 Sq. Ft.
South Tampa$52.00 Sq. Ft.N/A
I-75 Corridor$25.00 Sq. Ft.$26.00 Sq. Ft.
Downtown St. Petersburg$39.55 Sq. Ft.$44.35 Sq. Ft.

New Construction Pipeline:

  • Midtown East: The Primary new office construction of 85,000 SF is the second phase of Midtown Tampa, mixed use project located in the heart of Tampa. 50,000 SF has already been preleased.
  • Ybor: 95,000 SF for Grow Financial in Ybor broke ground

2025 3rd Quarter Forecast:

What does this mean for Tenants?

Advantages:

  • Companies who desire to be in suburban areas such as Northwest Tampa in near Hillsborough Avenue/ Veterans Expressway and Carrollwood and I-75 Corridor,  have more negotiating leverage on rental rate and lease concessions due to the higher vacancy rates in buildings.
  • Tenants in the 10,000 + Square Foot range have a stronger position across all Submarkets when negotiating with Landlords.

Challenges:

  • Flexible work schedules with a mix of in office and work from home, continues to be a work in progress as companies evaluate what is best for their team. Every industry is different and everyone company is different.
  • Class A rents are forecasted to continue to increase
  • The continued shift of focusing on strategic office location with surrounding amenities and environment that compel employees to want to come into the office can drive companies to the same Submarkets and buildings, creating vacancies in less desirable buildings and competition in others.

Considerations:

  • Due to low vacancy in a submarket like Tampa CBD, allow plenty of lead time before a lease ends is vital when considering a relocation or expansion.
  • Evaluating submarkets outside of Westshore or Tampa CBD, will provide more favorable rental rate and lease terms. 
  • If Tenants are finding themselves in place of uncertainty for their office space, Coworking solutions have become very common in Tampa Bay, providing a mix of individual offices and conference rooms to be used for monthly and quarterly meetings.
  • Tenants who want to subleasing their space, positioning the space below market rent and free rent will position the space to be the frontrunner with competitors. 

What does this mean for Landlords?

Opportunities:

  • Landlords with buildings located in Downtown Tampa Core or Westshore Business District, with onsite and nearby amenities should experience the most leasing activity and ability to be more selective when evaluating Tenants.
  • Tenant’s who have experienced the dramatic rent increases and leases are coming up for renewal, could now be priced out of Tampa CBD or Westshore. Outlying areas such as Northwest Tampa, may benefit. 

Challenges:

  • Buildings located in suburban corridors like the Northwest and i-75 are experiencing the highest vacancy rates with companies minimizing their office footprints and focusing on prime locations.

Considerations:

  • Landlord’s in high vacancy areas, can offer additional incentives for Tenants with shorter lease terms, higher Tenant Improvement allowance and rent abatement to incentivize companies to consider a building and location they typically would not.
  • Frequency of office space use and operational layouts are being reimagined and repurposed, consider providing conference room space for Tenants who only need use of a conference room on a monthly or quarterly basis.

Chelsea Drinkard No Comments

4th Quarter 2024 Tampa Bay Office Market Report and Forecast

Economic Factors:

  • Although Tampa Bay’s unemployment rate increased to 3.8% in Q4, it still falls below the national rate of 4.0%.
  • “The area’s private sector employment increased by 17,500 jobs (+1.2 %) over the year in December 2024. In December 2024, the Tampa metro area also led the metro areas in job gains over the year in education and health services, adding 7,900 jobs; and information, adding 1,500 jobs” says the Florida Commerce.
  • Inflation Rate was up 1.6% as of Nov. 2024 in past 12 months via the US Bureau Labor Statistics. 
  • Per the Regional Competitiveness Report, “Tampa Bay is once again first in net migration and in the top five for in-migration ages 25-34 and business startup rates.”

Key Metrics in the Office Market:

  • 2024 ended with +/- 11% quarter-over-over increase in leasing activity.
  • Tampa Bay’s overall asking rates amongst all  building classes continued to increase reaching an all time high up +/- 3% Year-over-year and +/- 2.5% in Class A buildings. Class A buildings were predominantly driving the asking rate increase and quality Class B buildings experienced +/- 5% rent increase.
  • Majority of leasing activity occurred in Westshore Business District.
  • Overall vacancy ended at +/- 20% with Class A buildings at +/- 15%

Let’s Talk Rent Numbers:

Submarket Overall Average Asking Rent-All Classes Overall Asking Rent Class A
Westshore $36.00 Sq. Ft. $41.25 Sq. Ft.
Downtown Tampa $42.80 Sq. Ft. $45.00 Sq. Ft.
Northwest Tampa $28.25 Sq. Ft. $32.65 Sq. Ft.
South Tampa $37.25 Sq. Ft. N/A
I-75 Corridor $26.00 Sq. Ft. $27.20 Sq. Ft.
Downtown St. Petersburg $38.75 Sq. Ft. $39.50 Sq. Ft.

Building Highlights:

  • Midtown East: The Primary new office construction of 85,000 SF is the second phase of Midtown Tampa, mixed use project located in the heart of Tampa. 50,000 SF has already been preleased.

2025 1st Quarter Forecast:

What does this mean for Tenants?

Advantages:

  • Companies who desire to be in suburban areas such as Northwest Tampa in near Hillsborough Avenue/ Veterans Expressway and Carrollwood and I-75 Corridor,  have more negotiating leverage on rental rate and lease concessions due to the higher vacancy rates in buildings.
  • Tenants in the 10,000 + Square Foot range have a stronger position across all Submarkets when negotiating with Landlords.

Challenges:

  • Flexible work schedules with a mix of in office and work from home, continues to be a work in progress as companies evaluate what is best for their team. Every industry is different and everyone company is different.
  • Class A may continue to trend higher with limited new construction forecasted in the future and the flight to quality and work where you live trend.
  • The continued shift of focusing on strategic office location with surrounding amenities and environment that compel employees to want to come into the office can drive companies to the same Submarkets and buildings, creating vacancies in less desirable buildings and competition in others.

Considerations:

  • Allowing plenty of lead time before a lease ends is vital when evaluating Westshore and Downtown Tampa Core for a relocation or expansion.
  • If Tenants are finding themselves in place of uncertainty for their office space, Coworking solutions have become very common in Tampa Bay, providing a mix of individual offices and conference rooms to be used for monthly and quarterly meetings.
  • Companies footprints and office schedules are shifting, under 5,000 Square Feet office spaces may have more competition that pre-pandemic.
  • Tenants who are considering subleasing their space, positioning the space below market rent and (if there is a long remaining lease term) considering offering shorter lease terms for companies are looking for shorter lease terms Landlords typically do not agree to will provide an advantage among other spaces.

What does this mean for Landlords?

Opportunities:

  • Carving up larger office Suites for < 5,000 Square Feet Tenant’s to lease, although a high initial investment, can pay off long term with diversification of leases rolling and smaller vacancies.
  • Landlords with buildings located in Downtown Tampa Core or Westshore Business District, with onsite and nearby amenities should experience the most leasing activity and ability to be more selective when evaluating Tenants.

Challenges:

  • Buildings located in suburban corridors like the Northwest and i-75 are experiencing the highest vacancy rates with companies minimizing their office footprints and focusing on prime locations.

Considerations:

  • Landlord’s in high vacancy areas, can offer additional incentives for Tenants with shorter lease terms, higher Tenant Improvement allowance and rent abatement to incentivize companies to consider a building and location they typically would not.
  • Frequency of office space use and operational layouts are being reimagined and repurposed, consider providing conference room space for Tenants who only need use of a conference room on a monthly or quarterly basis.
Chelsea Drinkard No Comments

Third Quarter 2024 Tampa Bay Office Market Report and Forecast

3rd Quarter Tampa Bay Highlights:

Tampa Bay:

  • Although Tampa Bay’s unemployment rate increased to 3.4% in Q3, it still falls below the national rate of 4.1%
  • Inflation Rate is up is 3.1% as of Sep. 2024 and up 1.2% in past 12 months via the US Bureau Labor Statistics
  • A low cost of living and a strong job market helped to secure the 4th place ranking on the Wall Street Journal’s hottest job markets in the U.S. Another important aspect of Tampa Bay’s incredible economy that has led to new business relocation is the agreeable tax environment. 

Office Market:

  • Tampa Bay’s overall asking rates continued to increase with rising over 5%. Class A office space in Westshore and Downtown Tampa had the most significant upturn to +/- $41.00 PSF in Westshore and +/-$43.50 PSF in Downtown Tampa.
  • Vacancy rate in Downtown Tampa was +/- 13% and +/-19% in Westshore Business District. Vacancy rate in the Northwest and I-75 corridor in Tampa are significantly higher between +/-29% – +/-31%. Downtown St Petersburg was +/-9% with higher vacancy rates in Greater Pinellas County ranging from +/-13%-38%.

Let’s Talk Rent Numbers:

Submarket Overall Average Asking Rent-All Classes Overall Asking Rent Class A
Westshore $35.00 Sq. Ft.  $41.00 Sq. Ft. 
Downtown Tampa $42.09 Sq. Ft.  $43.50 Sq. Ft. 
Northwest Tampa $28.34 Sq. Ft.  $31.11 Sq. Ft. 
South Tampa $30.00 Sq. Ft.  N/A
I-75 Corridor $26.20 Sq. Ft.  $26.67 Sq. Ft. 
Downtown St. Petersburg $35.90 Sq. Ft.  $37.16 Sq. Ft. 

Building Highlights: 

  • Tampa International Airport: With Phase 1 of the renovations complete, Tampa International Airport sets its sights on Phase 2 of the expansion plan, which features a new pedestrian bridge, curbside express lanes and more.
  • Historic Gas Plant District: Construction on the largest development project in Tampa Bay history is slated to begin in early 2025. The phase one vertical development is promised to bring new housing, office space, meeting space and more to benefit all.

2024 3rd Quarter Forecast:

    • Labor Market: The influx of new jobs from Fortune 500 company relocation to the Tampa Bay area are a huge benefit to the economy.
    • Job Creation: Nonfarm employment grew by 25,900 jobs, or 1.7%, over the past year.
    • Supply: This marks the steepest quarterly improvement of vacancy rates since Q4 2017 and puts Tampa Bay in a great spot to continue to see the vacancy rates decrease into Q4.
    • Demand: This brought the year-to-date (YTD) total to 2.0 msf, a 14.1% decline compared to the same period in 2023. Thanks to influential accounting firms of PricewaterhouseCoopers and Clifton Larson Allen renewing their leases, the future looks promising.
    • Economic Indicators: The Tampa Bay MSA’s unemployment rate is likely to remain at 3.4%, which is significantly lower than the national rate of 4.1%. Employment is anticipated to continue growing in the region.

What does this mean for Tenants?

Advantages:

  • Companies who desire to be in auburn areas outside of the Downtown Core in Tampa and St. Petersburg and Westshore Business District, may have more negotiating leverage on rental rate and lease concessions due to the higher vacancy rates in buildings. 

Challenges:

  • Class A may continue to trend higher with limited new construction forecasted in the future and current trend of companies focusing on location of their office and surrounding amenities. 
  • There is over 300,000 RSF is for sublease in Westshore, giving Tenants who are in the market for sublease space the ability to shop around for the deal with the most favorable terms.

Considerations:

  • Allotting plenty of lead time before a lease ends is vital when evaluating Westshore and Downtown Core for a relocation or expansion. Vacancy rates are low and which creates competition for desirable available space.  
  • Tenants are considering subleasing their space, positioning the space below market rent and if there is a long remaining lease term, considering offering shorter lease terms for companies are looking for shorter lease terms Landlords typically do not agree to. 

What does this mean for Landlords?

Opportunities:

  • Landlords with buildings located in Downtown Core or Westshore Business District, with onsite and nearby amenities should experience the most leasing activity and ability to be more selective when evaluating Tenants.  

Challenges:

  • Buildings located in suburban corridors like the Northwest and i-75 are experiencing the highest vacancy rates with companies minimizing their office footprints and focusing on prime locations.

Considerations:

  • Offer additional incentives for Tenants with shorter lease terms, higher Tenant Improvement allowance and rent abatement to incentivize companies to consider a building and location they typically would not. 
Chelsea Drinkard No Comments

Second Quarter 2024 Tampa Bay Office Market Report and Forecast

2nd Quarter Tampa Bay Highlights:

Office Market:

  • Westshore and Downtown Tampa asking rents are +/- $6.75 PSF above the average of the surrounding areas, proving the demand for these particular submarkets for their location, amenities and quality buildings.
  • Vacancy rate in Tampa CBD is 15.5% and Westshore in 14% is substantially lower than the major metropolitan cities around the country including New York and Chicago.
  • Companies are continuing to come back to the office more on a regular basis as flexible work schedules continue to be tested. Mondays and Friday seem to be the day remote is most commonly occurring.

Let’s Talk Rent Numbers:

Submarket Overall Ave.  Asking Rent-All Classes Overall Ave. Asking Rent Class A
Westshore $32.50 Sq. Ft. $40.10 Sq. Ft.
Downtown Tampa $41.50 Sq. Ft. $43.36 Sq. Ft.
Northwest Tampa $24.50 Sq. Ft. $26.59 Sq. Ft.
South Tampa $25.25 Sq. Ft. $30.54 Sq. Ft.
I-75 Corridor $25.75 Sq. Ft. $28.57 Sq. Ft.
Downtown St. Petersburg $32.25 Sq. Ft. $37.52 Sq. Ft.

New Development Highlights:

  • Gas Worx: Ybor City real estate investor Darryl Shaw’s Gas Worx is a mixed-use development remaking older industrial and vacant properties between Ybor and the Channel District into a walkable area planned to have over 140,00 square feet of retail and 500,000 square feet of office space is 50% preleased before ground breaking. Grow Financial and Masonite, are the two current anchor Tenants in preleasing.
  • Midtown East: Second phase of Midtown with 177,000 Square Feet of mixed use space is under construction with expected completed in 2024.

2024 3rd Quarter Forecast:

  • More sublease space with longer, 3+ year remaining lease terms will come to the market while Tenants are restructuring their office needs and might have taken on more space during an expansion in a building they no longer need.
  • Asking face rates will remain of the same and decrease slightly in the Westshore, Central Business Districts

What Does This Mean for Tenants?

Advantages:

  • Landlords are more willing to give Tenant concessions of free rent and Tenant Improvement allowance. Depending on the Landlord, some are more flexible than others on the asking face rate, depending on the deal terms.
  • Leveraging sublease space can be a great solution for some Tenants who are targeting shorter lease terms and/or often lower rates. Increase in subleases with longer lease terms remaining 3+ years, can still provide a good solution with Improvements already completed in the Suite, lower asking rent or free rent.

Challenges:

  • Asking rates increased in first quarter and have maintain steady in the second quarter. Not as many tenants have vacated their spaces when their lease expires, although asking rental rates have gone up over the last five years.
  • Although many employees have returned to the office, identifying the right balance of in office and working remotely is a normal conversation for deciphering what best for the company culture. Important to note, each company is different and not one solution is best. Reimaging the purpose of your office space and what role do you want it to play within the company is a great start for this conversation.
  • If a Tenant has a Base Year prior 2022, they are experiencing significant pass thrus from Landlords due to surge in Real Estate Taxes and Property Insurance.

What Does This Mean for Landlords?

Opportunities:

  • Class A and amenity-focused buildings in areas like Westshore, South Tampa and the Central Business Districts are performing better due to the focus on the office experience by Tenants. Tenants are adjusting their office footprint, tend to prefer amenity focused buildings where common areas like conferencing centers and be utilized for meetings vs leasing larger space.
  • Having spec suites ready for Tenant’s to lease a turn key office, positions Landlord to provide an immediate solution for Tenants who have quick deadlines to relocate their office vs the continued delay in permitting process and unexpected cost of Tenant Improvements.

Considerations:

  • Maintain asking face rates or be willing to adjust face rates depending on the feedback from Tenants.
  • Providing 3 year lease options for as-is Suites can be solution for smaller Tenants under 2,500 RSF, who are unsure about future growth.
  • Consider adding Tenant amenities such as conferencing center to a building for Tenants is a great competitive advantage. Based on the research, employees are coming into the office for team, department and company-wide meetings.