**Major U.S. Office Markets See Wide Disparities in Demand During Q2**
Office demand across major U.S. markets diverged significantly in the second quarter of 2025, with some cities experiencing notable annual growth while others saw demand cool compared to the previous quarter. According to the latest VTS Office Demand Index (VODI) report, national office demand was up just over 11% year-over-year as of June 30, though demand remained relatively flat compared to Q1.
Chicago and San Francisco emerged as standout markets. Chicago reported a 60% year-over-year increase in demand and a 35% rise from the first quarter. San Francisco followed closely, with a 27% annual increase and a 40% jump quarter-over-quarter.
Seattle and New York showed moderate annual growth—each around 18%—but saw differing quarter-to-quarter results. Seattle’s demand dropped 38% from Q1, while New York held steady with a modest 1% gain.
On the other end of the spectrum, Washington, DC, Los Angeles, and Boston experienced setbacks in demand, reversing previous post-pandemic recovery trends. Washington, DC recorded the most significant annual decline at 26%. Boston faced its weakest post-pandemic quarter yet, with office demand falling 46% from the previous quarter.
“The last quarter presented a number of macroeconomic challenges to the office market, and despite that, demand among tenants remained relatively persistent, with national office demand posting double-digit annual gains,” said Nick Romito, CEO of VTS. “There are a number of major economic, political, and innovation forces currently at play which have meaningful impacts on office demand—both in terms of headwinds and green shoots. I think we’ll continue to see somewhat of a mixed bag with regards to office demand in at least the near term.”
