BOSTON — Boston’s downtown office market showed continued signs of recovery during the second quarter of 2026, with strong net absorption, declining vacancy rates, and sustained tenant demand, according to CBRE’s latest Boston/New England Office Market report.
The market recorded 803,879 square feet of positive net absorption during the second quarter, a dramatic turnaround from the 143,900 square feet of negative absorption reported during the same period a year ago. Vacancy also continued to improve, falling to 18.7%, down from 19.1% in the second quarter of 2025.
The report found that tenant demand remained healthy at 4.3 million square feet, while total leasing activity reached 1.13 million square feet, outperforming the same quarter last year despite a slight decline from the previous quarter.
“The first half of 2026 showed meaningful improvement for Boston’s office market,” the report noted, pointing to stronger occupancy, lower availability, and continued leasing activity across key downtown submarkets.
Vacancy Declines Across Key Markets
Overall office availability dropped to 23.1%, down from 24.1% in the first quarter, while sublease availability declined for the 11th consecutive quarter, reaching 3.1%.
Class A office buildings continued to outperform the broader market, with vacancy falling to 18.3%, while Class B vacancy remained steady at 19.5%.
Among Boston’s major office districts:
- Back Bay posted the lowest overall vacancy at 13.9%, continuing to be one of the city’s strongest-performing office markets.
- Boston’s Central Business District (CBD) saw vacancy decline to 20.1%, while recording nearly 1 million square feet of positive net absorption.
- Seaport remained under pressure, with vacancy rising to 20.1% following the delivery of significant new office inventory.
Leasing Driven by Renewals
More than half of all leasing activity during the quarter consisted of renewals and expansions, accounting for 51.4% of total transactions.
The largest lease of the quarter was CIC’s 118,013-square-foot renewal at 50 Milk Street in Boston’s Financial District. Other major transactions included Autodesk’s renewal at 21-25 Drydock Avenue in the Seaport, Weiss Asset Management’s expansion at 222 Berkeley Street in Back Bay, and McCarter & English’s new lease at One International Place.
Overall, Class A properties accounted for nearly 62% of all leasing activity, highlighting continued demand for high-quality office space.
Construction Pipeline Slows
Following several years of significant office development, Boston’s construction pipeline has largely slowed.
The market delivered 635,000 square feet of new office space during the second quarter at Commonwealth Pier in the Seaport, following the completion of 350 Boylston Street earlier this year.
CBRE reported that no new office projects are currently under construction, marking a sharp decline from more than 5 million square feet that was under construction in early 2022.
While approximately 5.9 million square feet of future office projects remain proposed, no major new developments are expected to be completed before 2032.
Analysts believe the slowdown in new construction should help reduce vacancy over time by allowing demand to absorb existing inventory.
Rents Hold Steady
The average direct asking office rent across downtown Boston increased slightly to $66.32 per square foot, up from $65.89 one year ago.
Back Bay continued to command the region’s highest Class A office rents at $77.01 per square foot, while Boston’s Central Business District recorded the highest overall average asking rent at $68.83 per square foot.
Despite ongoing challenges facing office markets nationwide, CBRE’s second-quarter report suggests Boston continues to outperform many peer cities.
Declining vacancy, improving absorption, shrinking sublease inventory, and stable leasing demand indicate employers remain committed to high-quality office space, particularly in premier locations such as the Central Business District and Back Bay.
With the development pipeline slowing and demand remaining steady, Boston’s office market appears to be entering a more balanced phase after several years of post-pandemic adjustment.
