RALEIGH-DURHAM Q2 2026
OFFICE
MARKET REPORT
02
EXECUTIVE SUMMARY Q2 2026 MARKET Raleigh/Durham office market entered mid-2026 in a state of gradual stabilization, but not yet a 01 The broad recovery. Q2 reversed Q1’s positive absorption, although overall vacancy remains modestly below year-ago levels.
forward-looking indicators improved: leasing activity accelerated, sublease inventory 02 Several declined, asking rents remained relatively stable, and virtually no new competitive supply is being added.
market is best characterized as active but highly selective. Tenants are signing leases, particularly 03 The below 10,000 SF, but relocations, contractions, and delayed occupancies are still preventing leasing activity from translating into sustained positive absorption.
CL ASS A MARKET INVENTORY SNAPSHOT
35.94MM 16.6%
936K (65.6K)
TOTAL INVENTORY SF
VACANCY RATE
SUBLEASE SF
5.96MM
$33.16 FS
DIRECT VACANT SF
AVG ASKING RENT
= CHANGES BASED ON QOQ
NET ABSORPTION
Source: CoStar 2026
03
OUTLOOK & STR ATEGIC INSIGHT S KEY TRENDS TO WATCH
1.
2.
LEASING ACTIVITY VS OCCUPANCY GROWTH
SMALL-TENANT DEMAND AND LARGE-BLOCK EXPOSURE
Transaction activity accelerated during Q2, but relocations, contractions and delayed occupancies continue to prevent leasing volume from translating into sustained positive absorption.
The market has a healthy pool of smaller users, while demand above 30,000 SF remains extremely limited; buildings with divisible floorplates, existing buildouts and move-in-ready suites should therefore outperform assets dependent on large users.
3. SUPPLY-SIDE STABILIZATION Declining sublease inventory and virtually no new construction provide meaningful structural support. These factors should allow vacancy to tighten as demand improves, but elevated existing availability means landlord pricing power has not yet returned.
LOCAL BROKERAGE INSIGHTS INVESTOR TAKEAWAYS • Well-located, appropriately capitalized office assets have an opportunity to capture demand during a period of virtually no new competitive supply. • Elevated Class A vacancy and limited large -user demand create potential acquisition opportunities, but successful execution will depend heavily on basis, leasing capital and the ability to subdivide oversized vacancies. • Asking rents remain relatively stable, but face rates likely overstate effective economics due to free rent, TI allowances and other concessions. • Owners should prioritize occupancy, engage existing tenants for renewal early and maintain flexibility on concessions while preserving face rental rates where possible.
•
Tenants remain active and willing to transact, but they continue to prioritize move -in-ready space, flexibility and compelling overall economics with a focus on minimizing out of pocket upfit costs
•
Leasing activity is stronger than absorption suggests, with Q2 transaction volume increasing 59% year over year. However, nearly 89% of transactions remain below 10,000 SF, highlighting the continued scarcity of large requirements capable of materially reducing major vacancies.
•
Buildings offering divisible floorplates, quality second-generation space and well-designed spec suites are best positioned to capture the market’s most active segment of demand.
04
R ALEIGH-DURHAM MARKE T MARKET OVERVIEW - CLASS A ANNUAL NET ABSORPTION - 2026 YTD 2,500,000
METRIC
CURRENT
QoQ
YoY
2,000,000
VACANCY RATE
16.6%
+20 bps
-30 bps
DIRECT SF AVAILABLE
5,957,345 SF
+65,612 SF
-430,533 SF
NET ABSORPTION
-65,612 SF
-291,264 SF
-392,059 SF
AVG ASKING RENT
$33.16
-$0.20
+$0.30
SUBLEASE AVAILABILITY
935,507 SF
-40,062 SF
-147,145 SF
# OF NEW LEASES
45
+8
+10
3,000,000
1,500,000 1,000,000 500,000
160,040
0
(84,271)
-100,000
-200,000
2016
2017
2019
2020
2021
2022
2023
2024
2025
2026
CLASS B&C
350,000+ SF
VACANCY 18%
16.6%
16% 14% 12% 10%
8.3%
8% 6%
TOTAL SF BY QUARTER
CLASS A
2018
250,000 SF
2%
2026
0 2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2025
45
33
31 41
35
200,000 SF 150,000 SF 100,000 SF 50,000 SF 0 SF
4%
37
300,000 SF
Q1
Q2
Q3
Q4
NEW CLASS A FULL SERVICE LEASES SIGNED - 2026 vs. 2025 Source: CoStar 2026
05
Q2 2026 T O P T R A N S A C T I O N S LEASES
1.
2.
3.
4.
5.
SALES C R A BT R E E O V E R LO O K 2 3 01 S U GA R B U S H R D SUBMARKET: Glenwood/Creedmoor TENANT: Marsh McLennan TYPE: Renewal SQUARE FOOTAGE: 33,652 SF
REGENCY CREEK I 12 0 4 0 R E G E N C Y P K W Y SUBMARKET: Cary TENANT: Garmin TYPE: Renewal SQUARE FOOTAGE: 27,668 SF
17 0 0 P E R I M E T E R 17 0 0 P E R I M E T E R PA R K D R SUBMARKET: RTP/RDU TENANT: PlayMetrics TYPE: New SQUARE FOOTAGE: 26,341SF
B LO C 8 3 B L D G 2 6 21 H I L L S B O R O U G H S T SUBMARKET: West Raleigh TENANT: RapidScale TYPE: Sublease SQUARE FOOTAGE: 27,210 SF
MAIN DISTRIC T - NORTH HILLS 4 3 5 0 L A S S I T E R A T N O R T H H I L L S AV E SUBMARKET: Six Forks/Falls of Neuse TENANT: Couchbase TYPE: New SQUARE FOOTAGE: 19,463 SF
1.
2.
3.
4.
5.
CONCOURSE LAKESIDE I & II 2 8 01 & 2 8 0 3 S L AT E R R D , M O R R I S V I L L E CITY: Morrisville SELLER:TD Bank BUYER: Glidewell SQUARE FOOTAGE: 158,256 SF PURCHASE PRICE: $10,575,000 ($67/SF) PA R K W E S T O N E & T W O 15 4 01 & 15 5 01 W E S T O N P K WAY, C A RY CITY: Cary SELLER: Adler Real Estate Partners BUYER: CityPlat SQUARE FOOTAGE: 94,880 SF PURCHASE PRICE: $10,300,000 ($109/SF) 3 515 G L E N W O O D 3 515 G L E N W O O D AV E , R A L E I G H CITY: Raleigh SELLER: Oak Street Real Estate Capital BUYER: Schmier Property Group SQUARE FOOTAGE: 72,930 SF PURCHASE PRICE: $26,750,000 ($367/SF) RDU CENTER I 3000 RDU CENTER DR, RALEIGH CITY: Raleigh SELLER: RealOp Investments BUYER: James & Lynn Sears SQUARE FOOTAGE: 60,083 SF PURCHASE PRICE: $6,200,000 ($103/SF) MEADOWMONT CROSSING BLDG C 400 MEADOWMONT VILLAGE CIR, CHAPEL HILL CITY: Chapel Hill SELLER: SITE Centers BUYER: Woodside Health SQUARE FOOTAGE: 39,041 SF PURCHASE PRICE: $11,050,000 ($283/SF) Source: CoStar 2026
06
SUBMARKET BREAKDOWN P R I M A RY C O S TA R O F F I C E R A L E I G H S U B M A R K E T S 85
5.66M
WEST RALEIGH
147
540
3.89M
CARY
40
2.87M
DOWNTOWN RALEIGH
440
540 264
4.48M
RTP/RDU
1
40 70
4.63M
SIX FORKS FALLS OF NEUSE
1.67M
GLENWOOD/CREEDMOOR
WEST RALEIGH CARY
1.20M
ROUTE-1
0M
1M
DOWNTOWN RALEIGH
2M
3M
4M
5M
EX IST ING INV ENTO R Y ( TOTAL RBA)
RTP/RDU SIX FORKS FALLS OF NEUSE GLENWOOD/CREEDMOOR ROUTE-1
P R I M A RY C O S TA R O F F I C E D U R H A M S U B M A R K E T S
Source: CoStar 2026
RESEARCH TRIANGLE
4.72M
RESEARCH TRIANGLE
DOWNTOWN DURHAM SOUTH DURHAM
3.53M
DOWNTOWN DURHAM
ORANGE COUNTY
SOUTH DURHAM
85 85
1.36M
501
ORANGE COUNTY
0M
147
1.35M 1M
2M
3M
4M
EX IST ING INV ENTO R Y (TOTAL RBA)
5M
40
440
540 64
1
Source: CoStar 2026
07
R ALEIGH CL ASS A SUBMARKET PERFORMANCE EXISTING INVENTORY
CLASS A PRIMARY SUBMARKETS
# Bldgs
West Raleigh
VACANCY
LTM NET ABSORP.
LTM DEL.
UNDER CONST SF
QUOTED RATES
Total RBA
Sublet SF
Direct SF
Vac %
50
5,655,430
130,934
823,082
14.6%
8,914
-
-
$32.66
Cary
43
3,889,644
24,211
502,476
12.9%
108,234
-
-
$29.95
Downtown Raleigh
14
2,886,908
51,082
655,766
22.7%
53,618
-
-
$36.03
RTP/RDU
38
4,477,044
467,178
809,696
18.1%
(51,878)
-
-
$30.10
Six Forks Falls of Neuse
35
4,631,265
30,005
893,078
19.3%
352,183
-
-
$41.08
Glenwood/Creedmoor
17
1,671,738
21,545
208,143
12.5%
52,395
-
-
$35.59
Route-1
12
1,201,996
23,077
131,668
11.0%
71,044
-
-
$36.36
C L AS S A D I R E C T VAC A N CY BY S U B M A R K E T 24%
22.7%
22.0%
22%
VACANCY
20% 18% 16% 14%
17.5%
18.1%
19.3%
16.7%
16.2% 14.8%
14.6%
15.3%
16.2%
12.9%
12.5%
12%
11.0%
10% Q2 2026 Q2 2025
0%
WEST RALEIGH
CARY
DOWNTOWN RALEIGH
RTP/RDU
SIX FORKS/FALLS OF NEUSE
GLENWOOD/ CREEDMOOR
ROUTE 1
Source: CoStar 2026
08
DURHAM CL ASS A SUBMARKET PERFORMANCE EXISTING INVENTORY
CLASS A PRIMARY SUBMARKETS
# Bldgs
Research Triangle
VACANCY
Total RBA
Sublet SF
Direct SF
Vac %
LTM NET ABSORP.
LTM DEL.
UNDER CONST SF
QUOTED RATES
42
4,718,961
80,329
823,332
17.4%
(182,108)
-
-
$30.58
Downtown Durham
23
3,533,063
40,862
425,390
12.0%
11,719
-
-
$37.97
South Durham
15
1,357,902
5,036
387,716
28.6%
(24,598)
-
-
$27.32
Orange County
16
1,345,548
-
243,055
18.1%
32,768
-
-
$34.99
C L AS S A D I R E C T VAC A N CY BY S U B M A R K E T 28.6% 24%
23.3%
22%
VACANCY
20% 18%
18.1% 16.7%
17.4%
16% 14% 12%
12.1%
13.4% 12.0%
10% Q2 2026 Q2 2025
0%
RESEARCH TRIANGLE
DOWNTOWN DURHAM
SOUTH DURHAM
ORANGE COUNTY
Source: CoStar 2026
09
ECONOMIC DRIVERS POPULATION & JOB GROWTH RALEIGH
DEMOGRAPHICS
Population Growth Unemployment Office Jobs Growth
DURHAM
DEMOGRAPHICS
Population Growth Unemployment Office Jobs Growth
CURRENT LEVEL
LTM CHANGE
10-YEAR CHANGE
FORECAST (5 YRS)
Metro
U.S.
Metro
U.S.
Metro
U.S.
Metro
U.S.
1,616,650
342,433,219
1.6%
0.2%
2.2%
0.6%
1.3%
0.3%
3.5%
4.5%
0.3%
0.2%
-0.1%
0.0%
0.0%
0.0%
851,595
170,451,438
0.3%
-0.1%
2.2%
0.7%
0.8%
0.1%
CURRENT LEVEL
LTM CHANGE
10-YEAR CHANGE
FORECAST (5 YRS)
Metro
U.S.
Metro
U.S.
Metro
U.S.
Metro
U.S.
634,593
342,433,219
1.0%
0.2%
1.3%
0.6%
0.7%
0.3%
3.7%
4.5%
0.4%
0.2%
-0.1%
0.0%
0.0%
0.0%
324,595
170,451,438
0.2%
-0.1%
1.3%
0.7%
0.3%
0.1%
Source: CoStar 2026
R ALEIGH NAMED
#22 BEST PLACE TO LIVE IN AMERICA & #2 TO LIVE IN NC NICHE | MAY 2026
DIX PARK NAMED #5 BEST CITY PARK IN THE U.S. USATODAY | APRIL 2026
DURHAM-CHAPEL HILL #2 AND RALEIGH-CARY #7 AMONG THE MOST EDUCATED U.S. METRO AREAS WALLETHUB | JUNE 2026
ABOUT FOUNDRY P L A T F O R M O V E R V I E W Foundry Commercial began as CNL Commercial Real Estate in 2007, when 12 former Trammell Crow partners set out to build a different kind of real estate company – one that serves as a local service provider, operating partner, and a sophisticated investment platform. With 120+ brokers operating in the office, industrial, multifamily, retail, healthcare, and religious/notfor-profit verticals, Foundry’s platform offers brokerage, property management, facilities management, project management, and asset identification. Additionally, Foundry leverages our investment platform to help clients and investment partners execute their investment strategies in office, industrial, and retail real estate. Explosive growth during the firm’s first eight years sparked a management-led buyout and rebrand to Foundry Commercial in September 2015. In early 2020, Foundry’s partners acquired majority ownership of the company, which has grown to become a regional real estate services and operating company with over 460 real estate professionals, more than 78 million square feet of projects in 13 offices throughout the southeast.
Foundry Staffed Services Foundry Ongoing Activity
13 M A R K E TS S E R V E D
460+ 78 M SF A S S O C I AT E S
O F L E A S I N G & M A N AG E M E N T
R A L E I G H - D U R H A M
O F F I C E
AG E N C Y
T E A M
JANE DOGGETT, PARTNER, MARKET LEADER 919.625.8828 jane.doggett@foundrycommercial.com
PATRICK BLACKLEY, SENIOR VICE PRESIDENT 919.274.9323 patrick.blackley@foundrycommercial.com
MEGHAN HURLEY, MARKETING ASSOCIATE 919.271.9557 meghan.hurley@foundrycommercial.com
Although the information contained herein was provided by sources believed to be reliable, Foundry Commercial makes no representation, express or implied, as to its accuracy and said information is subject to errors, omissions or changes.