Office Market Posted A Nominal Loss for 2022
At the end of Q4 2022, Oahu’s office market posted a slight loss of 1,537 square feet of net absorption as vacancy rates rose from 12.85% to 12.90% during the past quarter. Comparing year-over-year performance, the market appeared relatively unchanged in 2022 with year-to-date loss of 1,461 square feet of net absorption as vacancy rate rose from 12.71%. Unfortunately, this calm exterior contradicted the underlying volatility of a transitioning office market.
Over the past three years, Oahu’s office market lost more than 240,000 square feet of occupancy, with vacancy rates jumping from 9.93% in Q4 2019 to nearly 13% at year-end 2022. During these COVID-19 pandemic years, many businesses re-evaluated their office space requirements and often reduced square footage.
Key Takeaways
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Q4 2022 net absorption posted a small occupancy loss of 1,537 square feet
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Office vacancy rates remained below 13% after jumping above 14% in Q2 2022
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The Central Business District posted its third consecutive quarter of occupancy gains
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Hybrid office conditions likely to persist
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Office market remains resilient despite slowdown in office leasing activity
