The Alexandria Economic Development Partnership today released its City of Alexandria Mid-Year Market Report, analyzing commercial real estate trends from January 1 through June 30, 2026 in the office market and, for the first time, the industrial market.
The office vacancy rate fell to 18.8% from 21.6% year-over-year, almost a full three-percentage-point drop. That change is due to the retention of the National Science Foundation, which moved into a 386,600 SF building formerly occupied by the U.S. Patent and Trademark Office in May, and construction on 5001 Eisenhower Avenue to convert the long-vacant office building to much-needed affordable housing began. The rate outperforms the region, with Northern Virginia posting a 20.1% office vacancy rate.
Net absorption remains negative, despite steady lease transaction volume, suggesting that tenants are resizing as the market continues to recover from the pandemic and adjust to office conversions and redevelopment.
For the first time, the semi-annual analysis examines Alexandria’s industrial market, amid growing demand for flex and light industrial spaces that are rare inside the Beltway. Industrial vacancy is at 5.9% for an inventory of approximately 4.4 million SF.
That rate increased slightly after Peraton vacated 14,000 square feet to consolidate in Herndon, and WareSpace removed 950 S. Pickett Street from the market to create co-warehousing. This renovated space has recently been reintroduced to the market for lease.
The report also highlights notable office and industrial leases over 5,000 SF and office building sales that took place in the first half of the year.
The statistics included in the report are based on AEDP’s analysis of CoStar, Colliers, and Newmark data to accurately reflect the City of Alexandria’s boundaries, leasing and sales activity, and development.