Early in the COVID-19 pandemic, mixed-use neighborhoods in D.C. were more economically resilient than office-heavy neighborhoods.[1]
As the chart above shows, office-heavy neighborhoods have consistently posted a higher annual office vacancy rate than mixed-use ones. Moreover, unlike office-heavy neighborhoods, mixed-use neighborhoods did not experience a substantial increase in their annual office vacancy rate between 2019 and 2020.
In recent years, mixed-used neighborhoods seem to have lost their advantage in securing new leases. Since 2021, the vacancy rate of mixed-use neighborhoods has increased at a similar or slightly faster pace than the rate of office-heavy ones. Not only does this trend suggest that the problem of office vacancies is spreading beyond downtown D.C., the trend also invites questions about what the best neighborhood model is for the city’s future.
[1] This piece borrows its classification scheme from Bailey McConnell, “Is mixed-use the future of downtown D.C.?,” D.C. Policy Center, November 23, 2021, https://www.dcpolicycenter.org/publications/mixed-use-future-downtown-dc/. Neighborhoods classified as “mixed-use” include “Southwest, Capitol Hill, Georgetown, West End, NoMa, and Capitol Riverfront.” The two neighborhoods classified as “office-heavy” are the “Central Business District (CBD) and East End.” The CoStar data used in this piece was downloaded in late May of 2024.