The Sarasota office market stands as the largest in Southwest Florida, boasting over 28 million square feet of inventory. Despite facing several quarters of negative absorption in the past two years, the market maintains one of the lowest vacancy rates in the state.
Market Performance
Over the past year, the overall market recorded -38,000 square feet of absorption, resulting in a 4.9% vacancy rate as of the first quarter of 2025.
Leasing Activity
Leasing activity has remained steady over the past two years, with approximately 875,000 square feet of activity per year. This level is consistent with pre-pandemic norms and is primarily composed of leases under 10,000 square feet. Notably, only nine new leases exceeding 10,000 square feet were executed in 2024.
Construction and Development
No new inventory was completed in 2024, a significant factor in maintaining Sarasota’s low vacancy rate. Approximately 11,000 square feet is currently under construction, which is typical for the market. Widespread speculative construction is unlikely due to the average asking rent of $30.00 per square foot, which does not support new development.
Rental Trends
Asking rents have increased by 2.8% YOY, surpassing the national rent growth rate of 1.0% as well as the historical average. The sub-5% vacancy rate is expected to empower landlords to continue pushing rents in the near term. The forecasted rent growth average is coming in at 1.5%.
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