In Q2 2025, Tampa’s office market reflected a balance of strong tenant activity and cautious investment trends. The quarter recorded 1.4 million SF of leasing, though new deliveries of 486,000 SF kept the vacancy rate at 9.9%. Rents continued to climb, with the average asking rate reaching $31.08/SF, up 4.6% year-over-year, driven by demand in prime submarkets. On the investment side, sales totaled $234.6 million, with pricing averaging $186/SF and cap rates at 7.4%, signaling selective but steady buyer interest. With only 277,000 SF under construction, new supply remains limited, helping support stable fundamentals moving forward.

 

Highlights

• Solid Leasing Momentum: Roughly 1.4M SF of office space was leased during Q2, pushing f irst-half leasing activity to 3.7M SF, about 20% above the 2015–2019 average. Large-scale commitments, including Fisher Investments (320K SF) and GEICO (190K SF), helped absorb long-standing vacancies.
• Rents Rising Despite Vacancy Pressure: Average asking rents climbed to $31.08/SF, reflecting 4.6% YOY growth. Demand is strongest in Westshore and Downtown trophy assets, where top-tier rents exceed $48–$65/SF, though overall market vacancy stands at 9.9%.
• Muted Investment but Stable Pricing: Office investment totaled $234.6M in sales volume for the quarter, with an average sales price of $186/SF and a 7.4% cap rate.

 

Market Demographics

Source: CoStar Group, Inc.

• Unemployment Rate: 3.7%
• Current Population: 3,464,907
• Households: 1,412,262
• Median Household Income: $76,789

 

Tampa Office Rents

Tampa’s office market saw average asking rents rise to $31.08/SF, up 4.6% year-over-year, with a clear divide between top-tier and suburban markets. Westshore and Downtown led the region at roughly $37/SF, while trophy assets pushed rates above $48/SF and Midtown East reached $65/SF. Suburban submarkets largely remained under $30/SF, where long-standing vacancies pressured landlords to be more flexible. Limited concessions in prime areas and varying tenant improvement allowances highlight strong demand for premium space, though weaker suburban assets are likely to keep broader rent growth in check.

 

Market Asking Rent Per SF

Source: CoStar Group, Inc.

 

Tampa Office Vacancy

Momentum in Tampa’s office market carried into Q2 2025, with tenant demand holding strong even after a record-setting start to the year. The quarter saw 1.4 million SF leased, bringing year-to-date activity to 3.7 million SF—roughly 20% above pre-pandemic norms. Landmark deals from Fisher Investments and GEICO helped absorb long-vacant space and underscored confidence in the market. Still, the vacancy rate held at 9.9%, as new deliveries and persistent softness in older product offset the strength of Class A assets.

 

Vacancy Rate

Source: CoStar Group, Inc.

 

Tampa Office Construction

Construction remained limited in Q2 2025, with only 277,000 SF underway, largely dependent on preleasing. Deliveries totaled 486,000 SF, led by the completion of Midtown East, Tampa’s first new office tower since 2021, where tenants like TECO and Booz Allen Hamilton have already committed at rates up to $65/SF. Projects such as Gas Worx in Ybor City and the planned Halcyon tower in Downtown St. Petersburg highlight that future office supply will be selective and tied to mixed-use developments. With the vacancy rate at 9.9% and 1.4M SF leased in the quarter, limited construction should help sustain market balance.

 

SF Under Construction

Source: CoStar Group, Inc.

 

 Tampa Office Sales

In Q2 2025, Tampa’s office sales activity totaled $234.6 million, with an average price of $186/SF and a 7.4% cap rate, keeping volumes well below pre-pandemic levels. Over the past year, sales reached $831 million, far short of the 2015–2019 average of $1.2 billion. Notable transactions included BayCare Health Systems’ $145 million purchase of three Tampa Bay Park buildings, accounting for more than half of Q1 volume. This signaled the influence of healthcare users. Industrial developers are also reshaping the market, with Clarion Partners and Creation Equities acquiring a Westshore site for $30 million and East Group buying a 66-acre campus for $32 million to redevelop into a 550,000-SF industrial park. With traditional office demand muted, investment is increasingly driven by users and developers repositioning assets.

 

Sales Volume & Market Sale Price Per Unit

Source: CoStar Group, Inc.

 

By the Numbers

Source: CoStar Group, Inc.

• Sales Volume: $234.6M
• Cap Rate: 7.4%
• Price Per SF: $186
• Vacancy Rate: 9.9%
• Rent Growth (YOY): 4.6%
• Asking Rent Per SF: $31.08
• SF Under Construction: 277K
• SF Delivered: 486K
• SF Leased: 1.4M