Economy
Economic momentum continued across Raleigh-Durham in Q3, with nonfarm employment increasing 1.6% year-over-year (YOY), ranking the Triangle third nationally for employment growth among more than 100 major metros tracked by Cushman & Wakefield Research. Unemployment remained low at 3.1%, 110 basis points (bps) below the national average of 4.2%. The region's sustained job growth and highly educated workforce continued to support long-term office demand, particularly among professional and technology-oriented occupiers.
Supply
The overall vacancy rate remained stable in Q3, rising by just 10 bps quarter-over-quarter (QOQ) to 21.5%. This marked the ninth consecutive quarter in which vacancy remained within a narrow 40-bp range. However, stability at the market level masked notable movement within individual submarkets, particularly US 1/Capital Blvd, where vacancy declined 920 bps QOQ to 15.2% due to the removal of over 115,000 sf of vacant space when The Frankie Lemmon Foundation School purchased two properties in this submarket. Looking ahead, vacancy is expected to tighten among higher-quality, well-located properties as tenants continue to prioritize modern amenities and accessibility.
Investment Sales
Office investment sales activity remained concentrated in suburban assets during Q3, with five properties trading at a median price of $88.00 per square foot (psf). The market has yet to record another significant trophy office transaction since Bloc[83] traded in early 2026. Investment activity is expected to remain measured as elevated borrowing costs and tighter underwriting continue to influence acquisitions.
Demand
Negative net absorption in Q3 was heavily influenced by a single large move-out rather than widespread occupancy losses. The market recorded 196,226 square feet (sf) of negative absorption, largely attributed to Research Triangle Institute’s (RTI) departure from three buildings totaling more than 311,000 sf in the RTP/I-40 Corridor submarket. This brought year-to-date (YTD) absorption to -165,153 sf, although 11 of the market's 15 submarkets recorded either occupancy gains or remained unchanged QOQ. The Six Forks submarket drove occupancy gains in the market with more than 87,000 sf, benefiting from continued tenant demand for high-quality office space in amenity-rich locations. The RTP/I-40 Corridor posted the largest occupancy decline at more than 370,000 sf. Despite the overall losses, six tenants occupied spaces exceeding 25,000 sf during the quarter.
New leasing totaled 528,096 sf in Q3, bringing YTD activity to more than 1.7 million square feet (msf). Although leasing remained 15.0% below the market’s five-year average, activity was generally consistent with the same period in 2025. Demand continued to be concentrated in higher-quality space, with Class A properties accounting for 80.9% of all YTD leasing, while The RTP/I-40 Corridor, Six Forks, and Downtown Raleigh submarkets collectively captured 57.1%, highlighting occupiers’ preference for high-quality space in established office locations.
Pricing
Pricing momentum strengthened during the quarter as average asking rents increased 2.2% QOQ to $31.60 psf. While most submarkets recorded only modest changes in rental rates, the Six Forks submarket recorded a notable 7.7% increase, pushing average asking rents to $42.77 psf. Growth was largely concentrated in North Hills, a micro market within the Six Forks submarket, where several top-tier office properties increased rates in response to amid strong tenant demand and limited availability.
