BETHESDA, MD–There has been little development in the Bethesda submarket for the past two years, leaving tenants clamoring not only for new product — but a different type of new product, according to a JLL market brief.
“Tenants want buildings with creative design and unique use of space,” JLL Senior Research Analyst Sara Hines tells GlobeSt.com. “Anything in the commodity class A space won't work. Even with generous TIs and other incentives, it won't work.”
According to JLL, demand is projected to lift occupancy in the Bethesda CBD class A to a historic high of 3.7 million square feet by 2019. Furthermore JLL identified 2.6 million square feet of prospective DC tenant expirations through 2025 for potential future Bethesda CBD relocation. Vacancy in the submarket is currently 3.8% for building built after 2000.
There are three building under development being built on spec and Hines believes these will lease up faster than a spec building usually does. The buildings are JBG Cos.' 4747 Bethesda Ave., Carr Properties' 7272 Wisconsin Ave. and StonebridgeCarras' 7359 Wisconsin Ave. for a total of one million square feet of trophy space.
“The trophy market has been underserved in Bethesda,” she says.
BETHESDA, MD–There has been little development in the Bethesda submarket for the past two years, leaving tenants clamoring not only for new product — but a different type of new product, according to a JLL market brief.
“Tenants want buildings with creative design and unique use of space,” JLL Senior Research Analyst Sara Hines tells GlobeSt.com. “Anything in the commodity class A space won't work. Even with generous TIs and other incentives, it won't work.”
According to JLL, demand is projected to lift occupancy in the Bethesda CBD class A to a historic high of 3.7 million square feet by 2019. Furthermore JLL identified 2.6 million square feet of prospective DC tenant expirations through 2025 for potential future Bethesda CBD relocation. Vacancy in the submarket is currently 3.8% for building built after 2000.
There are three building under development being built on spec and Hines believes these will lease up faster than a spec building usually does. The buildings are JBG Cos.' 4747 Bethesda Ave., Carr Properties' 7272 Wisconsin Ave. and StonebridgeCarras' 7359 Wisconsin Ave. for a total of one million square feet of trophy space.
“The trophy market has been underserved in Bethesda,” she says.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
