Understanding the Office Leasing Landscape in 2026

Office Leasing Just Doubled

Savills reports that Northern Virginia's leasing volume reached roughly 3.0 million square feet in the second quarter of 2026. This figure is more than double the first quarter and marks the third highest quarterly total in the last five years. The headline deals highlight where demand is concentrating. For instance, Deloitte renewed 641,000 square feet at 1919 N. Lynn Street in Rosslyn. Booz Allen Hamilton signed for 220,000 square feet at 1880 Reston Row Plaza. Peraton took 184,000 square feet at 2200 Woodland Pointe.

Avison Young's takeaway is crucial for tenants: these large block deals have absorbed Trophy and Class A space so quickly that options narrow sharply as your space requirement grows. The best buildings are filling up, while everything else sits vacant.

Arlington Vacancy is Still Elevated, and That is Leverage

Arlington's office vacancy remains near 24 percent. The county is actively pushing conversions of older office towers in Crystal City, Ballston, and Rosslyn into residential spaces. Lincoln Property Company's market data shows that the Washington DC metro lost roughly 103,900 jobs between January 2025 and January 2026. This loss keeps pressure on general office demand.

Translation: if you occupy commodity office space in Arlington or Fairfax, landlords need you more than you need them. Free rent, tenant improvement dollars, and shorter or more flexible terms are all achievable right now. However, the window is not open at the top of the market. If you want a quality building, the Q2 leasing surge indicates you cannot afford to sit on your hands.

Healthcare Space is Moving in the Opposite Direction

While general office space gives tenants leverage, medical space is experiencing the opposite trend. Cushman and Wakefield's 2026 Vital Signs report shows that medical outpatient absorption hit 3.8 million square feet nationally in the first quarter of 2026. This figure is up 71 percent year over year, pushing occupancy to 92.5 percent across the top 50 markets. New construction fell by 10 percent and now represents just 2.2 percent of existing inventory.

JLL's 2026 Medical Outpatient Building Perspective puts occupancy at a record 92.7 percent, with rent growth of 3.3 percent year over year. It notes that new construction rents are running nearly double in-place rents. CBRE reports that some providers are already being pushed into second-generation office space just to meet their requirements. JLL's warning to tenants is blunt: prepare for significant rent resets at renewal. The gap between in-place rents and market rents keeps widening.

The demand drivers are local as much as national. Fairfax County is the largest county in Virginia, with roughly 1.18 million residents and a median household income above $150,000. Arlington's median household income sits above $142,000, according to Census data. Add top regional hospital systems and the area's biomedical footprint, and you get the patient demographics that keep healthcare groups competing for a shrinking pool of clinical space.

Two Playbooks for 2027 and 2028 Expirations

If you are a general office tenant, press your advantage now. Benchmark your rent against the market, ask for concessions, and use the county's vacancy problem as your negotiating partner. Just know that the flight to quality is real. The good buildings are getting picked off.

If you are a healthcare, dental, or medical tenant, the market is moving against you. Start your planning 18 to 24 months before expiration, not just six. Landlords of medical buildings know their occupancy numbers. They understand that replacement space is scarce and will price renewals accordingly. Tenants who get ahead of the curve maintain their leverage. Those who wait may face the rent reset JLL warns about.

Where I Come In

I represent tenants and owner-users across Northern Virginia, focusing on healthcare and dental groups in Fairfax, Arlington, and the surrounding submarkets. I do not represent landlords, so my only job is to secure the best deal the market will offer. If your lease expires in the next 24 months or you are planning an expansion or relocation in Fairfax or Arlington, reach out through the contact page. I will provide you with a straightforward assessment of your options.