Leasing
Northern Virginia’s office leasing activity moderated in Q3 2026 following stronger activity in the second quarter. New leasing totaled 977,400 square feet (sf), bringing year-to-date (YTD) leasing to 3.3 million square feet (msf). Renewal activity totaled 434,700 sf during the quarter, bringing YTD renewals to 2.2 msf. Gross leasing reached 1.4 msf in Q3 and 5.5 msf YTD. Class A assets continued to capture most of the demand, accounting for 74% of new leasing and 69% of renewal activity during the quarter.
Fairfax County led the region with 674,300 sf of new leasing, accounting for 69% of total activity, followed by Arlington County with 209,300 sf, or 21% of the total. Leasing in Fairfax County was concentrated in Reston/Herndon and Tysons, which recorded 239,800 sf and 235,600 sf, respectively, while Fairfax/Oakton/Vienna totaled 95,300 sf. In Reston/Herndon, QTS signed a 77,000-sf lease at 1800 Reston Row Plz, MetroStar leased 38,000 sf at 12010 Sunset Hills Rd, and TekSynap took 26,500 sf at 11921 Freedom Dr. In Tysons, BAE Systems expanded by nearly 30,000 sf at 8201 Greensboro Dr while Middleburg Communities leased 27,800 sf at 1800 Tysons Blvd. In Arlington County, Crystal City/Pentagon City led with 89,300 sf of new leasing, followed by Rosslyn with 77,300 sf. In Crystal City, Shield AI expanded by 27,000 sf at 2450 Crystal Dr and the American Society for Radiation Oncology leased 17,000 sf at 2777 Crystal Dr, while Georgia Tech Research Institute expanded by 17,900 sf and Kimley-Horn leased 13,400 sf at 1700 N Moore St in Rosslyn.
Renewal activity was also concentrated in Fairfax County, which recorded 327,100 sf during the quarter. Reston/Herndon accounted for 175,500 sf, or 54% of renewal activity, followed by Tysons with 86,300 sf and Fairfax/Oakton/Vienna with 56,000 sf. In Reston/Herndon, Fluor Federal Solutions renewed 26,900 sf at 1800 Alexander Bell Dr, Karsun Solutions renewed 21,500 sf at 12825 Worldgate Dr and Tyto Athene renewed 19,500 sf at 11950 Democracy Dr. In Tysons, Mars, Inc. renewed 36,300 sf at 1676 International Dr while Protiviti renewed 14,900 sf at 1751 Pinnacle Dr. Fairfax/Oakton/Vienna activity included Riverside Research Institute signing an 8,000-sf expansion and 39,000-sf renewal at 12601 Fair Lakes Cir. Loudoun County recorded another 66,400 sf of renewal activity during the quarter
Supply & Demand
Net absorption rebounded to positive 413,800 sf in Q3, bringing YTD absorption to positive 369,800 sf. Alexandria posted the strongest quarterly performance with positive 377,800 sf, followed by Arlington County at positive 68,500 sf and Loudoun County at positive 19,100 sf. Fairfax County was the only major market to record occupancy losses, posting negative 51,600 sf during the quarter. Alexandria’s gains were driven overwhelmingly by Old Town, which recorded 389,400 sf of positive absorption as the National Science Foundation occupied 386,600 sf at 401 Dulany St. Arlington was led by Crystal City/Pentagon City with positive 105,500 sf, while Courthouse/Clarendon/ Virginia Square added another 34,400 sf.
Fairfax County’s quarterly losses were concentrated in Reston/Herndon, which recorded negative 75,100 sf, and Fairfax/Oakton/Vienna, which posted negative 42,100 sf. These declines were partially offset by positive 79,800 sf in Tysons and 19,300 sf in Route 28 South/Chantilly. Notable move-ins across the region included Peraton occupying 55,400 sf at 2250 Corporate Park Dr, American Systems Corporation taking 37,600 sf at 1550 Crystal Dr, KnowBe4 moving into 21,700 sf at 4075 Wilson Blvd and Lafayette Federal Credit Union occupying 21,100 sf at 1577 Spring Hill Rd. Large move-outs included Blackboard vacating 47,300 sf at 11720 Plaza America Dr, University of North America leaving 47,000 sf at 12750 Fair Lakes Cir, SpinSys vacating 23,500 sf at 3120 Fairview Park Dr and HydroGeoLogic leaving 20,100 sf at 11107 Sunset Hills Rd.
Vacancy & Rental Rates
Overall vacancy ended Q3 at 23.6%, down 10 basis points (bps) quarter-over-quarter (QOQ) and up 60 bps year-over-year (YOY). Class A vacancy increased 20 bps YOY to 23.4%, while Class B vacancy rose 170 bps YOY to 26.6%. Class C vacancy jumped 120 bps YOY to 15.1%, remaining the tightest segment of the market due to continued inventory reduction through conversions and building demolitions for residential or mixed-use developments.
Average asking rents increased to $36.45 per square foot (psf) on a full-service basis, up $0.09 from Q2. Class A rents rose to $39.00 psf, up $0.27 QOQ, while Class B rents declined $0.28 to $32.83 psf. Arlington County remained the highest-priced county at $40.63 psf, despite declining $0.09 from Q2. Alexandria posted the strongest rent growth, increasing $1.44 YOY and $0.34 QOQ to $36.76 psf, followed by Fairfax County, which increased $0.34 QOQ to $35.44 psf. Loudoun County also recorded rent growth, rising $0.05 QOQ to $28.87 psf.
