CW Va Survey 3q16

Market Report
Northern Virginia | 3rd Quarter 2016
cushmanwakefield.com
Contents
DC Metropolitan Area Overview..............................................................................3

Northern Virginia & Map........................................................................................4-6
Alexandria.........................................................................................................................7
RB Corridor.......................................................................................................................8
Crystal City/Pentagon City........................................................................................9
Tysons Corner....................... .......................................................................................10
Reston/Herndon............................................................................................................11
50-66.................................................................................................................................12
Route 28 South/Chantilly..........................................................................................13
Loudoun County...........................................................................................................14
Appendix..........................................................................................................................15
Tables..........................................................................................................................15-24
Methodology & Definitions......................................................................................25
About Cushman & Wakefield.................................................................................26
Cushman & Wakefield | 2
Washington, DC Metropolitan Area
While the narrative about job growthas well as the midterm

forecast for continued strong employment growthis compelling,
the headline may be that office market statistics are mixed. On the
one hand, vacancy appears to have peaked and is slowly declining
in the Washington, DC metro jurisdictions: the District of Columbia,
Northern Virginia, and Suburban Maryland. Regionally, vacancy was
17.8% at the end of the third quarter of 2016, down ever so slightly
from 17.9 % a year ago. But absorption is facing challenges. Current
space requirements per each job created in the Washington, DC
metro office market are much less than in previous cycles, and that
is having an impact on absorption levels. From 2002 to 2008, an
average 270 square feet (SF) of office space was absorbed for every
office job created regionally; from 2009 through 2016, that figure
declined to 60 SF. Furthermore, the contentious election season
seems to have put a damper on new leasing activity. Tenants have
taken a wait and see approach before executing new leases; that
has resulted in activity falling regionally to a year-to-date total
of 9.4 million square feet (MSF)below the 10-year average of
11.2 MSF typically registered in the first three quarters of a year.
The good news is that there are some signs that the pendulum is
swinging back from the extreme efficiency demands that caused
absorption to shrink in recent quarters, particularly in newer, highquality product in amenitized, transit-served locations. In the urban
core markets, two large law firmsVenable LLP and Arnold &
Porterboth exercised expansion rights shortly after or in advance
of occupying their newly constructed spaces. There is also evidence
that federal contractors are behaving similarly in suburban markets:
CSC has opted for another floor at 1775 Tysons Boulevard, adding
an additional 30,000 SF to its new Americas headquarters.
With continued growth in the economy, the improving (albeit
slowly) market conditions continue to keep investors bullish on the
outlook for the DC Metro region. Office sales activity surged in
the third quarter of 2016 by $2.1 billion, bringing the year-to-date
total to $4.9 billion. As has been the case throughout 2016, the
core downtown assets that brought downtown pricing to historic
highs in 2014 and 2015 remain scarce as longer term holders are
keeping these projects off the market. In turn, overall sales volume
has declined, with more suburban and value-add projects in the
pipeline for sale.
WASHINGTON, DC METRO
Economic Indicators
Q3 15
Q3 16
DC Metro Employment
3.18M
3.26M
DC Metro Unemployment
4.3%
3.9%
U.S. Unemployment
5.1%
5.0%
Q3 15
Q3 16
Overall Vacancy
17.9%
17.8%
Net Absorption
289K
544K
Under Construction
5.1M
8.4M
Deliveries
1.2M
2.5M
$35.03
$38.13
12-Month
Forecast
Market Indicators
Average Asking Rent (FS)
12-Month
Forecast
Net Absorption/Asking Rent

4Q TRAILING AVERAGE
$39.00
2.0
$38.50
$38.00
$37.50
1.0
$37.00
$36.50
$36.00
0.0
$35.50
$35.00
$34.50
-1.0
2010
2011
2012
2013
Net Absorption, MSF
2014
2015
2016
$34.00
Asking Rent, $ PSF
Washington, DC Metropolitan Area

NET ABSORPTION - DELIVERIES - VACANCY
10.0
20%
8.0
16%
6.0
4.0
12%
2.0
8%
0.0
-2.0
4%
-4.0
-6.0
Vacancy Rate
The Washington, DC metropolitan regions (DC Metro) economy

continued to register a staggering level of job growth through
the third quarter of 2016. As of September 2016, year-over-year
employment growth remained well above historical averages, with
the DC Metro economy creating 85,200 net new nonfarm payrolls.
That is the fourth highest job creation figure in the nation after
the New York, Dallas and Los Angeles metropolitan regions. On
a year-over-year percentage basis, job growth in the DC Metro
area is growing faster than in the New York, Los Angeles, Chicago,
San Francisco and Boston metropolitan regions. Moreover, officeusing employment has continued to expand, with over 35,000 jobs
created in office-using sectors since September of 2015, a level
only slightly below the typical combined annual office and nonoffice-using job creation figures in the Washington, DC region.
Indeed, one has to look back to mid-2010, prior to the time when
devastating effects of sequestration took hold in the region, to find
similar levels of office-using job creation. As has been the case
throughout 2016, Professional and Business Services employment
is leading job growth among all industry sectors, with 29,000 jobs
added to payrolls from September 2015 to September 2016. In
addition, positive job growththe likes of which the region hasnt
seen since early 2011has been particularly evident in the federal
government sector which added nearly 6,400 new payrolls from
September 2015 to September 2016.
MSF
We have the jobs...Now where is the Absorption?
05
06 07 08 09
Net Absorption
10 11 12 13 14 15
Deliveries
Vacancy Rate
16
0%
cushmanwakefield.com | 3
Northern Virginia
Economy
Market Indicators
Metropolitan Washington, DC continued to post strong job

growth, with the region adding 85,200 net new jobs in the last 12
months as of September 2016. This figure is more than double the
historical average, with the region registering the eighth-lowest
unemployment rate of the 50 largest metropolitan areas in the U.S.
Northern Virginia (NoVA) accounted for 32,100 of the regional total
led by the Professional and Business Services sector adding 17,860
jobs year-over-year.
Market Overview
3Q 15
3Q 16
Overall Vacancy
21.1%
21.1%
Net Absorption
401K
495K
Under Construction
3.2M
4.1M
Deliveries
Average Asking Rent
404K
636K
$33.21
$31.88
12-Month
Forecast
Net Absorption/Asking Rent
Job growth, typically a leading economic indicator, finally
4Q TRAILING AVERAGE
appeared to be having an impact on the Northern Virginia real
400
$35.00
estate market, as office space has experienced 494,676 square
200
$33.00
feet (SF) of positive year-to-date absorption. Class A product has

done particularly well, accounting for 1.1 million square feet (MSF)
of office-space absorption. The largest move of the quarter was
that of the U.S. Marshals Service, which vacated 1750 Crystal
$31.00
-200
$29.00
-400
Drive (due to undergo extensive renovations) to occupy 370,000
-600
SF at 1215 South Clark Street. Overall vacancy closed the third
-800
quarter of 2016 at 21.1%, unchanged from one year ago. Direct
$27.00
2011
2012
2013
2014
2015
Net Absorption, MSF
asking rental rates in NoVA stood at $32.24 per square foot, a
2016 Q3
$25.00
Asking Rent, $ PSF
4.0% decline from the third quarter 2015. This decline is due to
both strong leasing of premium space, and lowering of rents in
commodity buildings in an environment of elevated vacancy.
Proximity to transit and amenities continues to drive decision
making for the largest users in the NoVA market.
Applied
Predictive Technologies signed the largest lease of third quarter

2016, taking 98,800 SF at 4250 North Fairfax Drive in Ballston.
Tysons was home to the next two largest deals, with WeWork
committing to 92,500 SF at 1775 Tysons Boulevard, and M.C.
Dean signing for 85,600 SF at 1765 Greensboro Station Drive.
Four office buildings broke ground in the third quarter, each with
one prelease in tow: 2311 Wilson Boulevard (Opower), 8350 Broad
Street (TEGNA), 1041 Electric Avenue (Navy Federal Credit Union
[NFCU]), and 4097 Monument Corner Drive (Apple Federal Credit
Overall Vacancy
24%
22%
20%
Historical Average = 17%
18%
16%
14%
12%
2011
2012
2013
2014
2015
2016 Q3
Union). Opower signed a 44,900-SF prelease in the first quarter

and TEGNA a 70,063-SF prelease in the second quarter. NFCU,
the largest credit union in the nation, will occupy the entirety of
its 235,000-SF campus expansion building in Vienna.
Outlook
Buoyed by a handful of massive projects such as the CEB
Tower and the National Science Foundation headquarters, new
construction is at its highest point in almost 10 years. However,
continued growth in high-wage professional jobs and companies
that continue to show a preference for new and high-quality office
options should continue to drive demand into new construction.
With a stabilizing federal spending environment and strong
growth in the private sector, the Northern Virginia market is
poised to continue tracking away from historically high vacancy.
Large Blocks of Contiguous Space

25-50k SF
Loudoun County
50-100k SF
Route 28 South
100-150k SF
Springfield/Newington
150-200k SF
200k+ SF
50/66
Reston/Herndon
Tysons Corner
Arlington
Alexandria
0
20
40
60
80
# of Blocks
Northern Virginia Office Submarkets

Northern Virginia Office Submarkets
LOUDOUN
LOUDOUN
PHASE II
2016
267
MARYLAND
metro
ROUTE
772
metro
ROUTE
606
metro
RESTON
RESTON
267
INNOVATION
CENTER
WASHINGTON
DULLES
INTERNATIONAL
AIRPORT
PHASE I
metro
HERNDON
metro
RESTON TOWN
CENTER
metro
267
WIEHLE - RESTON
EAST
TY
UN
TY
CO
UN
CO
X
SPRING
HILL
FA
OU
WASHINGTON, DC
metro
IR
UD
123
28
Y
NT TY
OU UN
X C CO
FA N
IR TO
FA ING
L
R
A
FA
LO
DI
ST
DULLES
AIRPORT
D
AN
YL IA
AR IN
M IRG
V
metro
RI MA
RY
CT
OF LA
N
D
CO
LU
M
BI
A
HERNDON
HERNDON
LOUDOUN COUNTY
50
FAIRFAX COUNTY
GREENSBORO
metro
metro
metro
MCLEAN
TYSONS
CORNER
286
ARLINGTON COUNTY
TYSONS
metro
495
WEST FALLS
CHURCH
metro
EAST FALLS
CHURCH
VIR
metro
29
66
66
metro
metro
metro
BALLSTON
ALGONKIAN P
50
FAIRFAX CENTER
metro
IA
CLARENDON
VIRGINIA SQUARE - GMU
R-B CORRIDOR
495
VIENNA
66
AR
28
29
GIN
ROSSLYN
COURT HOUSE
metro
DUNN LORING/
MERRIFIELD
123
ROUTE 28 SOUTH
metro
50
50
metro
PENTAGON
CRYSTAL CITY
MERRIFIELD
AY
KW
29
395
RONALD
REAGAN
WASHINGTON
NATIONAL
NATIONAL
AIRPORT
AIRPORT
metro
236
I-395 CORRIDOR
286
FAIR FAX COUN

TY
PRINCE WILLIAM C
O
POTOMAC
RIVER
metro
VAN DORN
STREET
UNT Y
EISENHOWER
AVENUE
metro
KING STREET
metro
OLD TOWN
ALEXANDRIA
EISENHOWER
AVENUE
PRINCE WILLIAM COUNTY
95
metro
FRANCONIA/
SPRINGFIELD
SPRINGFIELD/
NEWINGTON
Top Transactions
Key Lease Transactions 3Q 2016
PROPERTY
SF
TENANT
TRANSACTION TYPE
SUBMARKET
4250 North Fairfax Drive
98,800
Applied Predictive Technologies
Relocation
Ballston
1775 Tysons Boulevard
92,517
WeWork
New Lease
Tysons
1765 Greensboro Place
85,859
M.C. Dean
Relocation
Tysons
Key Sales Transactions 3Q 2016

PROPERTY
SF
SELLER/BUYER
PRICE
SUBMARKET
Republic Park #1-8
532,041
Liberty Property Trust/MRP Realty
$97,000,000 / $183
Reston/Herndon
1 Dulles Corridor
215,000
Westbrook Partners/Rosenthal Properties & Wafra
$67,600,000 / $314
Reston/Herndon
Independence Center
275,000
Carr Properties/Tritower Financial
$60,500,000 / $221
Route 28 South/Chantilly
Northern Virginia Office Market
Northern Virginia Office Market
Net Absorption - Deliveries - Vacancy, Third Quarter 2016
Inventory and Vacancy by Submarket, Third Quarter 2016

30
25%
25%
25
20%
15%
10%
-1
-3
5%
2003
2004
2005
New Deliveries
2006
2007
2008
2009
2010
Net Absorption
2011
2012
2013
2014
2015
Vacancy Rate
2016
0%
20
MSF
20%
15%
15
10%
10
5%
5
0
Vacancy Rate
Vacancy Rate
Square Feet (Millions)
AlexandriaRB CorridorCrystal City TysonsReston/Herndon50/66

Route 28 S/Chantilly
Loudoun
Leased
Vacant
0%
Vacancy Rate
Alexandria
Market Indicators
*Arrows = Current Qtr Trend
Vacancy
23.4%
Net Absorption
Under Construction
52,900 SF
720,000 SF
Deliveries
Asking Rent
0 SF
$31.05 FS
The Old Town market continued to improve in the third quarter,
Net Absorption Deliveries Vacancy
years. As a whole, Alexandria has registered 124,100 SF of positive

Rental rates in the I-395 corridor and Huntington/Eisenhower
submarkets have remained largely unchanged over the past
several years, while rental rates in Old Town have increased 6%
over the past four quarters, ending the third quarter at $35.91
PSF, as this submarket continues to tighten.
Square Feet, 000s
year-to-date absorption, mainly due to demand from Old Town.
800
30%
600
25%
400
20%
200
15%
10%
-200
5%
-400
Alexandria posted a large win in the third quarter, convincing
-600
(with the help of incentives) The Motley Fool to renew for 113,000
SF at 2000 Duke Street. The media and finance company had
Vacancy Rate
as vacancy hit 8.4%, the submarkets lowest vacancy in over five
06
conducted a multi-jurisdictional search before deciding to stay
07
08
09
Net Absorption
10
11
Deliveries
12
13
14
15 YTD
16
Vacancy Rate
0%
Old Town Vacancy Rate
in the building it has occupied since 2005. A condition of the

incentives grant includes a provision for the company to add an
extra 60 employees on top of its existing 280. Other significant
New Leasing Activity
leases of the third quarter included Virginia Hospital Centers
1.20
17,784-SF new lease at 2800 Shirlington Road and Cotton &

Companys 8,346-SF sublease at 635 Slaters Lane.
1.00
0.80
renovations, as it seeks to reposition itself to better compete in a
MSF
The 335,000-SF Carlyle Tower is in the throes of comprehensive

competitive Class A market.
0.60
0.40
0.20
0.00
2006
2007
2008
2009
Q1
2010
2011
Q2
Q3
2012
2013
2014
2015
2016
Q4
Asking Rent
$39
The only building currently under construction in

Alexandria is the National Science Foundations (NSF)
future 700,000-SF headquarters at 2415 Eisenhower
Avenue. With construction due to wrap up in early 2017,
the market should soon discover how many contractors
will be tailing the agency and its large grants. Some firms
working on moonshot technologies may have an extra
incentive being near both the Patent and Trademark Office
and the NSF.
Full Service PSF
$37
Outlook
$35
$33
$31
$29
$27
$25
2011
2012
2013
Class A
2014
2015
2016
Class B
RB Corridor
Vacancy
22.5%
Net Absorption
Under Construction
97,800 SF
862,800 SF
Vacancy in the RB Corridor decreased to 22.5% at the end of the

third quarter of 2016, its lowest point since the second quarter of
2014. However, this rate is still above the 5-year average of 19.4%
and the 10-year average of 13.6%.
The RB Corridor recorded 97,800 SF of absorption in the
third quarter, bringing the year-to-date total to 156,000 SF.
Ballston accounted for all of the corridors positive absorption,
as Amazon moved into 50,000 SF at 4250 North Fairfax Drive,
CliftonLarsonAllen moved into 24,000 SF at 901 North Glebe
Road, Accenture occupied a 20,000 SF sublet at 4075 Wilson
Boulevard, and the Department of Homeland Security took
possession of 21,000 SF at 1525 Wilson Boulevard.
$40.87 FS
0 SF

1,000
25%
800
20%
600
400
15%
200
0
10%
-200
-400
5%
-600
-800
Direct rental rates declined to $40.86 PSF at the end of the third
quarter, their lowest rate in five years. High-end space was taken
off the market in Ballston and owners of commodity buildings
decreased rents in this extended period of high vacancy.
06
07
08
09
10
Net Absorption
11
12
13
15 YTD
16
Vacancy Rate
Deliveries
14
0%

1.60
1.40
1.20
1.00
MSF
The largest new lease of the quarter was in Ballston: Applied

Predictive Technologies signed for 98,800 SF at 4250 North
Fairfax Drive. A slate of large- and medium-sized deals in the
third quarter included Regus Spaces concept signing of 45,000
SF in the Artisphere at 1101 Wilson Boulevard, technology
company Snagajob taking 31,200 SF of sublease space at 1919
North Lynn Street, and the National Association of Chemical
Distributors relocating into 31,000 SF on the top floors of 1515
North Courthouse Road. The largest renewal of the quarter was
Sinclair Television Groups 15-year lease extension (to commence
in 2019) of 100,000 SF at 1100 and 1000 Wilson Boulevard.
Asking Rent
Deliveries
Vacancy Rate
Square Feet, 000s
Market Indicators
0.80
0.60
0.40
0.20
The only significant trade of the quarter occurred in Ballston.

Clark Enterprises sold 4001 North Fairfax Drives 190,000 SF to
Penzance for $62,500,000 ($329/SF). 2311 Wilson Boulevard
has entered into construction, as each of the Corridors three
submarkets now has one building being built.
0.00
2006
2007
2008
2009
Q1
2010
2011
Q2
Q3
2012
2013
2014
2015
2016
Q4
Asking Rent
$50
Outlook
Year-to-date leasing activity in the RB Corridor ended
the third quarter of 2016 at 1.01 MSF, 22% higher than
2015s annual total, and equal to 2014s total. This is not
a large jump in leasing activity, but is a positive sign for
the corridor which has faced headwinds for several years.
Look for association and non-profit leasing to increase
in the medium term, as a new administration begins to
establish its policies and budget.
Full Service PSF
$48
$46
$44
$42
$40
$38
$36
$34
$32
2011
2012
2013
Class A
2014
2015
2016
Class B
Crystal City/Pentagon City

Vacancy
Net Absorption
Under Construction
Deliveries
Asking Rent
22.3%
140,300 SF
0 SF
0 SF
$37.43 FS
Move-ins and move-outs in the Crystal City submarket continue

to offset one another. Vacancy has hovered in the 20%-23%
range over the past four years and ended the third quarter at
21.5%. Direct average asking rents continue to contract from
the high of $41.00 PSF in 2013 to the current $37.43 PSF. Rents
have declined 2.5% over the past four quarters, due primarily to
lowering of rents in Class B buildings.
The largest move of the quarter was that of the U.S. Marshals
Service, which vacated 1750 Crystal Drive (due to undergo
extensive renovations) to occupy 370,000 SF at 1215 South
Clark Street. Other positive absorption resulted from Chemonics
International and NaAliI Consulting moving into 54,000 SF and

30%
500
25%
20%
-500
15%
-1,000
10%
-1,500
5%
-2,000
9,000 SF, respectively, at 251 18th Street. Negative absorption

in both the first and second quarters of 2016 slowed as a result
of the US Marshalls expansion this quarter, making year-to-date
absorption a slightly negative 16,738 SF.
06
07
08
09
10
Net Absorption
11
12
13
15 YTD
16
Vacancy Rate
Deliveries
14
0%

2.50
2.00
1.50
MSF
The largest new lease of the third quarter was that of the
Metropolitan Washington Airports Authority which signed for
74,248 SF of former Environmental Protection Agency space
at 2733 Crystal Drive, as the agency relocated out of Reagan
National Airport. Contractor signings in the third quarter
included Lockheed Martins renewal of 141,761 SF at 2121 Crystal
Drive, American Systems renewal for 21,880 SF at 1401 S Clark
Street, and C3 Systems sublease of 18,322 SF at 2900 Crystal
Drive. Leasing activity, at 329,473 SF year-to-date, is on track to
outpace the 2014 figure of 387,748 SF but total below the 2015
figure of 787,968 SF.
1,000
Vacancy Rate
Square Feet, 000s
Market Indicators
1.00
0.50
0.00
2006
2007
2008
2009
Q1
2010
Q2
2011
Q3
2012
2013
2014
2015
2016
Q4
Asking Rent
$44
Outlook
The potential merger between Vornado Realty Trust and
JBG would bring fresh eyes and seasoned development
professionals to a recovering market with an aging
inventory. Recently delivered multifamily buildings such as
The Bartlett and m.Flats bring the submarket closer to its
mixed-use vision.
Full Service PSF
$42
$40
$38
$36
$34
$32
2011
2012
2013
Class A
2014
2015
2016
Class B
Tysons Corner
Net Absorption
Under Construction
Deliveries
Asking Rent
118,500 SF
1,751,800 SF
475,800 SF
$31.93 FS
Tysons continues to be a hub of activity as the submarket

registered 1.0 MSF of leasing activity during the first three
quarters of 2016, accounting for 25% of the total activity in
Northern Virginia (NoVA) and more than any other submarket.
Tysons also claimed three of NoVAs top four leases in the third
quarter: WeWork for 92,517 SF at 1775 Tysons Boulevard, the U.S.
Customs and Border Protection agency for 89,834 SF at 7799
Leesburg Pike, and M.C. Dean for 85,859 SF at 1765 Greensboro
Station Place. The largest renewals of the quarter were those of
NetApp for 66,877 SF at 1921 Gallows Road and Smith Pachter &
McWhorter for 15,742 SF at 8000 Towers Crescent Drive.
Tysons was home to a number of large move-ins in the third
quarter, resulting in 118,512 SF of net positive absorption. The
largest move-outs were those of Morgan Lewis and Regus
vacating 42,000 SF and 23,000 SF, respectively, at 1600 Tysons
Boulevard; Watt Tieder leaving 65,000 SF at 8405 Greensboro
Drive; and Palantir vacating a floor at 1660 International Drive.
These large move-outs were offset by significant move-ins:
Capital One occupied 137,000 SF at Silverline Center, Watt
Tieder moved into 33,000 SF at 1765 Greensboro Station Place,
Columbia College occupied 26,000 SF at 8620 Westwood Drive,
and Alarm.com again expanded by 23,000 SF at 8281 Greensboro
Drive.
8350 Broad Street, along with accompanying multifamily and
retail aspects of the Boros first phase, started construction in
the third quarter. TEGNA signed a prelease for 70,000 SF on
the top floors of the 20-story building, accounting for 16% of the
buildings eventual 436,800-SF footprint.

1,000
25%
800
20%
600
400
15%
200
0
10%
-200
-400
Vacancy Rate
Vacancy
20.7%
Square Feet, 000s
5%
-600
-800
06
07
08
09
10
Net Absorption
11
12
13
14
15 YTD
16
Vacancy Rate
2012
2013
Deliveries
0%

3.50
3.00
2.50
MSF
Market Indicators
2.00
1.50
1.00
Beacon Capital Partners sold American Center East and West

(8300/8330 Boone Boulevard) to Banyan Street Capital, based
in Miami. The combined 333,000 SF sold for $68.5M ($206/SF)
0.50
0.00
2006
2007
2008
2009
Q1
2010
2011
Q2
Q3
2014
2015
2016
Q4
Asking Rent
$50
There is currently 1.75 MSF under construction in Tysons,

42% of the total in Northern Virginia. Two of the buildings
under constructionCapital One Tower and MITRE IVare
build-to-suit projects which will be fully occupied upon
delivery. The market has successfully absorbed a handful
of new and renovated speculative buildings over the past
several years: 7900 Tysons Boulevard, 7900 Westpark
Drive, 7940 Jones Branch Drive, and 1775 Tysons Boulevard
which is now 65% leased after signing WeWork. With over
two years to go before delivery of The Boros 8350 Broad
Street, the small amount of remaining new space in these
delivered buildings have a buffer before competing new
product comes online.
Full Service PSF
Outlook
$45
$40
$35
$30
$25
2011
2012
2013
Class A
2014
2015
2016
Class B
Reston/Herndon
Net Absorption
Under Construction
Deliveries
Asking Rent
(31,500) SF
354,900 SF
0 SF
$28.88 FS
Vacancy in the Reston/Herndon submarket was 16.6% at the end

of the third quarter, down 10 basis points (BP) from the second
quarter and remains below the 5-year average of 17.1%. After
hitting a 5-year high in the second quarter, direct asking rental
rates also ticked downward to settle at $28.88 PSF at the end of
the third quarter.
The market experienced low occupier activity in the third
quarter, as negative absorption of 31,500 SF pushed year-to-date
absorption to a negative 130,518 SF. Comcast vacated 29,000 SF
at 12801 Worldgate Drive, Qinetiq/Vencore moved out of 25,000
SF at 11091 Sunset Hills Road, National Rural Telecommunications
Cooperative gave back one 24,000 SF floor at 2121 Cooperative
Way, and Software AG vacated 24,000 SF at 11700 Plaza America
Drive. The only significant move-in of the quarter was that of DPR
Construction into 21,000 SF at 11109 Sunset Hills Road, followed
by a slate of smaller occupancies.
Northern Virginias largest renewal of the third quarter took place
in Reston/Herndon as Boeing recommitted to 168,200 SF at
460 Herndon Parkway. The Federal Home Loan Banks (Office of
Finance) renewed for 26,000 SF at Reston Town Centers 1818
Library Street. The largest new leases included CDW signing for
32,500 SF at 2001 Edmund Halley Drive, followed by Personify
for 13,900 SF at 13450 Sunrise Valley Drive and V-Brick for 13,300
SF at 607 Herndon Parkway. The submarket experienced its
lowest quarterly leasing volume in over three years, but year-todate leasing activity, at 0.8 MSF, puts the submarket in second
place behind Tysons 1.0 MSF of activity.

2,500
25%
2,000
20%
1,500
10%
500
5%
0
-500
06
07
08
09
10
11
Net Absorption
12
13
Deliveries
14
15 YTD
16
0%
Vacancy Rate

3.00
2.50
2.00
1.50
1.00
Comstock Partners 1900 Reston Metro Plaza, to be the

submarkets newest office building since 2009, does not yet have
any leases signed midpoint in its construction. If its 368,000
SF were to deliver fully vacant in Q3 2017, this would increase
Reston/Herndons vacancy rate by 150 BP.
The largest portfolio sale of the quarter was that of Liberty Park,
consisting of eight properties on Dulles Technology Drive in
Herndon. Liberty Property Trust sold the combined 532,041 SF
for $97M ($182/SF) to Walton Street Capital. Westbrook Partners
sold 10740 Parkridge Boulevard to Rosenthal Properties and
Wafra Investment Advisory Group. The 215,716-SF building, along
with an adjacent land parcel, sold for $68.1M ($316/SF).
15%
1,000
Vacancy Rate
Vacancy
16.6%
Square Feet, 000s
MSF
Market Indicators
0.50
0.00
2006
2007
2008
2009
Q1
2010
2011
Q2
Q3
2012
2013
2014
2015
2016
Q4
Asking Rent
$32
Outlook
Several redevelopment plans moving through the pipeline
will further increase the large number of approved and
pending developments along the Toll Road. General
Dynamics 357,000 SF secure campus has received
approval from the Fairfax Board of Supervisors, Vornados
1.43 MSF of proposed mixed use development at Commerce
Executive Center gained planning commission support,
and NVRs plan to construct a mix of 383 multi-family units
and townhomes at Woodland Park also obtained planning
commission support.
Full Service PSF
$30
$28
$26
$24
$22
$20
2011
2012
2013
Class A
2014
2015
2016
Class B
50/66
Vacancy
21.4%
Under Construction
Net Absorption
385,000 SF
(201,300) SF
Merrifield/Route 50
Leasing activity in the Merrifield/Route 50 submarket has
been steady over the past two years, averaging 58,500 SF per
quarter. The most significant deal of the third quarter was Inova
Healthcare Services signing of a 52,200-SF renewal and 41,900SF expansion at 8111 Gatehouse Road. Vacancy ticked upward
from 17.1% in the second quarter of the year to 19.0% in the third,
as two large tenants vacated the submarket for Class A buildings
in Tysons: CSC moved out of 80,000 SF at 8613 Lee Highway and
Reed Smith vacated 61,000 SF at 3110 Fairview Park Drive. Apple
Federal Credit Union has begun construction of its new 150,000SF headquarters expansion at 4097 Monument Corner Drive.
It plans on occupying a majority of the building, with Peterson
Companies agreeing to take about half of the remaining space.
Direct asking rental rates currently stand at $30.31 PSF, and have
remained largely unchanged over the past several years.
Asking Rent
0 SF
$24.83 FS

400
25%
200
20%
15%
-200
10%
-400
5%
-600
-800
06
07
08
09
10
Net Absorption
11
12
13
Deliveries
14
15
Q1
16
0%
Vacancy Rate

2.00
Fairfax/Oakton/Vienna
1.80
1.60
1.40
1.20
MSF
Vacancy in the Fairfax/Oakton/Vienna submarket rose to its

highest level in over 15 years, ending the third quarter at 23.1%,
as the submarket has become largely reliant on renewals of small
professional services firms. Rental rates in the submarket, at
$25.20 PSF, trail behind only those of the Loudoun County and
Annandale submarkets.
Deliveries
Vacancy Rate
Square Feet, 000s
Market Indicators
1.00
0.80
0.60
Navy Federal Credit Union (NFCU), the largest credit union in

the country, broke ground on its 235,000-SF campus expansion
at 1041 Electric Avenue. Although the owner-occupied campus
does not have a direct impact on the competitive office market,
expansion by this financial firm positively affects talent makeup
and income in the vicinity. This building will be an addition to the
existing 901,000-SF headquarters building across the street.
0.40
0.20
0.00
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Q1 Q2 Q3 Q4
Asking Rent
$34
Outlook
$32
Full Service PSF
Although ridership is down and SafeTrack work this

year has been largely focused on the orange line, tenant
preference for Metro-accessible buildings and other
associated amenities continues strong. As several buildings
along Prosperity Avenue and the Gallows Road corridor
between the Mosaic District and Dunn Loring-Merrifield
Metro stop approach full occupancy, building parks such
as WillowWood Plaza and Fairview Park may begin to
attract tenants in tertiary submarkets such as Fair Lakes
and the I-395 Corridor.
$30
$28
$26
$24
$22
2011
2012
2013
Merrifield/Route 50
2014
2015
2016
Vacancy
21.6%
Net Absorption
Under Construction
Deliveries
Asking Rent
247,000 SF
0 SF
150,000 SF
$25.91 FS
The Route 28 South submarket experienced a large quarterover-quarter drop in vacancy, from 24.1% in the second quarter
to 21.6% at the third quarter, as the GSA occupied its second
160,000-SF built-to-suit building on Stonecroft Boulevard, and
Deloitte and the American Registry for Internet Numbers (ARIN)
moved into 27,000 SF and 24,000 SF, respectively, at 15049
Conference Center Drive. Class A vacancy declined to 19.7%, its
lowest point since the third quarter of 2014. After declining from
the $28 PSF range to the $26 PSF range between 2012 and 2014,
direct asking rental rates have remained relatively steady over the
past two years.

1,200
600
20%
400
15%
200
0
10%
-200
-600
5%
06
07
08
09
10
Net Absorption
11
12
13
Deliveries
14
15 YTD
16
0%
Vacancy Rate

1.20
1.00
0.80
MSF
Capital markets transactions in the third quarter included Carr

Properties sale of its 274,223-SF property at 15036 Conference
Center Drive for $60.5M ($221/SF) to Tritower Financial Group,
based in Boston. The building is greater than 80% leased to a
variety of federal contractors. The 146,444-SF property at
4795 Meadow Wood Lane sold for $9.0M ($62/SF) from LNR
Partners to the American Armed Forces Mutual Aid Association,
a member-owned life insurance company based in Reston.
25%
800
-400
Absorption in the third quarter was 246,981 SF, bringing the

year-to-date total to 464,081 SF, double that of the next-highest
submarket, Tysons. Absorption should slow moving forward, as
the submarket experienced almost no new leasing activity this
quarter. However, a stabilizing federal spending environment,
strong private-sector job growth, and no new construction starts
should keep an upward cap on vacancy rates. Renewals included
American Systems Corporations 57,600 SF lease extension at
14151 Park Meadow Drive and Aetnas 24,800 SF lease extension
at 14155 Newbrook Drive.
30%
1,000
Vacancy Rate
Square Feet, 000s
Market Indicators
0.60
0.40
0.20
0.00
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Q1 Q2 Q3 Q4
Asking Rent
$30
Outlook
For a submarket with a heavy presence of government
contractors and civil engineering firms, a new
administration may prove beneficial to tenants in Route 28
South. Promises from both major parties to vastly increase
funding for big-ticket items such as infrastructure and
cybersecurity gives established government contractors
the ability to further pivot toward these future areas of
growth.
Full Service PSF
$28
$26
$24
$22
$20
$18
2011
2012
2013
Class A
2014
2015
2016
Class B
Loudoun County
Vacancy
18.2%
Net Absorption
Under Construction
Deliveries
Asking Rent
9,900 SF
64,800 SF
0 SF
$24.37 FS
Loudoun County continues to offer perhaps the best value of any

submarket in NoVA, as tenants can find attractive rental rates in
high-quality, newer buildings. The submarkets 5.1 MSF of office
space currently posts a vacancy rate of 18.2%, its lowest in over
ten years. Absorption has been positive in eight of the last nine
quarters, causing vacancy to fall 560 BP over the period.
The market experienced high leasing volume in the third quarter,
including a new 24,677 SF lease from Unanet at 22970 Indian
Creek Drive, and a new 20,854 SF lease from Truestone at 21355
Ridgetop Circle. New leasing has been consistent over the past
two years, averaging 43,000 SF of new leasing activity per
quarter. The submarket is on track to surpass 200,000 SF of new

600
500
300
15%
200
10%
100
5%
0
-100
06
07
08
09
10
11
Net Absorption
12
13
Deliveries
14
15 YTD
16
0%
Vacancy Rate

0.90
0.80
0.70
0.60
MSF
In the third quarter, Retail Properties of America announced

its intention to purchase the downtown of One Loudoun for
$161 million. This retail-heavy area contains a variety of bars,
restaurants, a cinema, and a grocer. Miller & Smith plans to further
develop the rest of the town center (which it will continue to own)
with multifamily units.
20%
400
leasing in 2016, which would be the highest annual leasing figure

since 2009.
The only building currently under construction is the 15,000-SF
19320 Diamond Lake Drive. This property is described as a live/
work building and is being constructed in the heart of Lansdowne
Town Center.
25%
Vacancy Rate
Square Feet, 000s
Market Indicators
0.50
0.40
0.30
0.20
0.10
0.00
2006
2007
2008
2009
Q1
2010
2011
Q2
Q3
2012
2013
2014
2015
2016
Q4
Asking Rent
$28
Outlook
Loudoun Countys office market should continue to benefit
as development continues to shift westward along the Toll
Road and as tenants widen their search for space along
the length of the built and under construction portions of
the Silver Line. Proximity to executive housing, new and
affordable building product, and an increasing amount of
retail options will continue to benefit the submarket.
Full Service PSF
$26
$24
$22
$20
$18
$16
2011
2012
2013
Class A
2014
2015
2016
Class B
Appendix
Table Summaries
Metro Washington Office
Market Summary
15
Employment Data
15
Office Availability, Vacancy,
and Net Absorption
16
Metro Washington Office Market Summary: Third Quarter 2016p

Inventory
Total Vacant
Space
Vacancy
Rate
Q22016 Absorption
Year to Date
Absorption
Washington, DC
108,620,109
12,919,188
11.9%
108,557
580,677
Northern Virginia
130,524,599
27,572,227
21.1%
442,988
442,988
Suburban Maryland
56,596,533
12,005,453
21.2%
-7,974
232,508
Regional Totals
295,741,241
52,496,868
17.8%
543,571
1,256,173
Trailing 12-Month Data

17
Historical Year-End Data
18
Metro Washington Current Employment Data

Non Farm
Employment
(Jan-Sep 2015)
Non Farm
Employment
(Jan-Sep 2016p)
Jobs Added/
Lost*
Percent Change
Washington, DC
765,856
776,911
11,055
1.4%
Northern Virginia
1,399,311
1,430,522
31,211
2.2%
973,522
996,444
22,922
2.4%
3,161,722
3,235,644
73,922
2.3%
Market Statistics by Class

19-20
Survey of New Office Space
by Submarket
21-24
Methodology & Definitions
25
Suburban Maryland
Regional Totals
SOURCE: U.S. Bureau of Labor Statistics (Not seasonally adjusted)

* Average per year to date
p - preliminary
3,779,328
10,762,437
868,376
15,423,648
7,095,248
10,945,402
32,211,020
21,265,618
7,991,666
6,058,050
2,423,709
16,473,425
48,684,445
1,369,626
6,608,194
9,509,467
23,055,893
24,230,837
8,675,922
3,268,420
76,718,359
16,117,661
5,121,795
81,840,154
130,524,599
Ballston
Arlington County
RB Corridor
Old Town
I-395 Corridor
Huntingon/Eisenhower
City of Alexandria
Inside the Beltway
Annandale/Baileys
Merrifield/Route 50
Tysons Corner
Reston/Herndon
Rt 28 S/Chantilly
Springfield
Fairfax County
50-66 Corridor
Loudoun County
Outside the Beltway
Northern Virginia
1,386,142
1,070,506
62,787
164,970
1,007,719
16,733
186,500
403,671
222,531
62,829
102,141
13,314
315,636
77,564
20,822
8,262
48,480
153,505
238,072
84,567
33,593
55,946
63,966
Sublet Space
Available
27,572,227
16,494,154
931,163
3,445,591
15,562,991
1,055,704
1,873,568
4,020,370
4,763,899
2,192,657
1,252,934
403,859
11,078,073
3,856,892
837,928
2,347,297
671,667
4,778,321
7,221,181
2,442,860
1,374,984
1,003,992
2,399,345
Total Space
Available
21.1%
20.2%
18.2%
21.4%
20.3%
32.3%
21.6%
16.6%
20.7%
23.1%
19.0%
29.5%
22.8%
23.4%
34.6%
38.7%
8.4%
22.5%
22.4%
22.3%
19.4%
18.1%
27.8%
Vacancy
Rate
411,825
122,142
21,860
(184,777)
100,282
20,417
241,446
(120,311)
150,548
(88,009)
(96,768)
(7,041)
289,683
46,032
(5,196)
3,048
48,180
96,825
243,651
146,826
90,506
17,680
(11,361)
New/Relet
Absorption
31,163
29,791
(11,925)
(16,553)
41,716
(3,311)
5,535
88,811
(32,036)
(8,703)
(7,850)
(730)
1,372
6,899
(8,945)
(3,100)
18,944
1,010
(5,527)
(6,537)
15,576
(15,377)
811
Sublet
Absorption
442,988
P - Preliminary

151,933
9,935
(201,330)
141,998
17,106
246,981
(31,500)
118,512
(96,712)
(104,618)
(7,771)
291,055
52,931
(14,141)
(52)
67,124
97,835
238,124
140,289
106,082
2,303
(10,550)
Total Net
Absorption
1 The Rosslyn/Ballston (R/B) corridor is comprised of Rosslyn, Clarendon/Courthouse, Virginia Square, and Ballston submarkets.

2 Inside the Beltway is comprised of Arlington County and Alexandria/Outside the Beltway is comprised of Fairfax and Loudoun Counties

3 The 50/66 corridor is comprised of Merrifield, Vienna, Oakton, Fairfax Center, and Fairfax City submarkets.

****New Space Available and New Space Absorption based on buildings delivered 2005 to present
26,186,085
3,280,621
14,555,272
1,038,971
1,687,068
3,616,699
4,541,368
2,129,828
1,150,793
390,545
817,106
2,339,035
623,187
4,624,816
6,983,109
2,358,293
1,341,391
948,046
5,531,747
Courthouse/
Clarendon/Virginia Square
2,335,379
8,638,623
New/Relet Space
Available
Rosslyn
Total Inventory
Office Availability, Vacancy, and Net Absorption, Third Quarter 2016p
Appendix
8,638,623
8,613,043
5,531,747
7,076,618
10,945,402
32,166,810
21,221,408
8,191,666
6,058,050
2,742,707
16,992,423
49,159,233
1,358,705
6,608,194
9,505,603
23,240,699
24,690,837
9,242,182
3,268,420
77,914,640
16,113,797
5,121,795
83,036,435
132,195,668
Rosslyn
Courthouse/
Clarendon/
Virginia Square
Ballston
Crystal City/
Pentagon City
Arlington County
RB Corridor
Old Town
I-395 Corridor
Huntington/
Eisenhower
City of Alexandria
Inside the Beltway
Annandale/Baileys
Merrifield/Route 50
Tysons Corner
Reston/Herndon
Rt 28 S/Chantilly
Springfield
Fairfax County
50-66 Corridor
Loudoun County
Outside the Beltway
Northern Virginia
130,922,599
81,900,154
5,121,795
16,117,661
76,778,359
3,268,420
8,675,922
24,290,837
23,055,893
9,509,467
6,608,194
1,369,626
49,022,445
16,811,425
2,761,709
6,058,050
7,991,666
21,265,618
32,211,020
10,945,402
7,095,248
5,531,747
8,638,623
2nd Qtr 2016
130,524,599
81,840,154
5,121,795
16,117,661
76,718,359
3,268,420
8,675,922
24,230,837
23,055,893
9,509,467
6,608,194
1,369,626
48,684,445
16,473,425
2,423,709
6,058,050
7,991,666
21,265,618
32,211,020
10,945,402
7,095,248
5,531,747
8,638,623
3rd Qtr 2016
21.2%
19.7%
20.3%
18.5%
19.7%
35.1%
24.8%
16.4%
19.1%
17.4%
20.2%
30.4%
23.6%
25.0%
42.3%
37.3%
10.2%
23.7%
22.9%
21.3%
18.9%
21.7%
29.1%
4th Qtr
2015
21.4%
20.2%
19.7%
19.9%
20.2%
33.2%
25.0%
17.1%
19.3%
21.6%
17.4%
31.5%
23.5%
24.7%
41.4%
37.5%
9.1%
23.3%
22.9%
22.2%
21.1%
18.6%
28.1%
1st Qtr
2016
21.6%
20.2%
18.4%
20.2%
20.3%
34.5%
24.1%
16.7%
20.3%
22.3%
17.1%
28.9%
23.9%
25.2%
41.4%
38.7%
9.2%
23.1%
23.2%
23.6%
21.7%
17.6%
27.7%
2nd Qtr
2016
Office Vacancy Rate
21.1%
20.2%
18.2%
21.4%
20.3%
32.3%
21.6%
16.6%
20.7%
23.1%
19.0%
29.5%
22.8%
23.4%
34.6%
38.7%
8.4%
22.5%
22.4%
22.3%
19.4%
18.1%
27.8%
3rd Qtr
2016
150,018
125,945
18,110
7,300
107,835
111,018
(8,266)
(109,727)
160,384
33,223
(25,923)
(52,874)
24,073
(132,450)
(4,877)
(99,645)
(27,928)
159
156,523
156,364
46,270
(89,724)
43,613
4th Qtr 2015
(319,132)
(299,410)
33,198
(220,679)
(332,608)
63,345
136,827
(195,888)
(97,668)
(406,138)
185,459
(18,545)
(19,722)
35,511
17,713
14,386
3,412
38,501
(55,233)
(93,734)
(209,841)
172,148
76,194
1st Qtr 2016
370,820
378,712
37,123
(42,342)
341,589
(41,660)
80,273
96,870
212,913
(66,305)
23,963
35,535
(7,892)
35,702
(551)
43,842
(7,589)
19,699
(43,594)
(63,293)
(42,416)
54,119
7,996
2nd Qtr 2016
Total Office Absorption

2 Inside the Beltway is comprised of Arlington County and Alexandria/Outside the Beltway is comprised of Fairfax and Loudoun Counties.


4 The I-395 and Springfield/Newington submarkets were updated in the second quarter of 2012 with additional inventory.

p- preliminary
130,440,659
81,418,214
5,121,795
16,117,661
76,296,419
3,268,420
8,675,922
24,290,837
22,573,953
9,509,467
6,608,194
1,369,626
49,022,445
16,811,425
2,761,709
6,058,050
7,991,666
21,265,618
32,211,020
10,945,402
7,095,248
5,531,747
1st Qtr 2016
Total Office Inventory
4th Qtr 2015
Trailing 12-Month Data
442,988
151,933
9,935
(201,330)
141,998
17,106
246,981
(31,500)
118,512
(96,712)
(104,618)
(7,771)
291,055
52,931
(14,141)
(52)
67,124
97,835
238,124
140,289
106,082
2,303
(10,550)
3rd Qtr 2016
Appendix
23,240,699
24,690,837
1,358,705
6,746,835
9,505,603
23,638,285
24,690,837
9,092,182
3,268,420
78,300,867
16,252,438
Merrifield/Route 50
Tysons Corner
Reston/Herndon
Rt 28 S/Chantilly
Springfield
Fairfax County
50-66
132,781,417
Northern Virginia
130,524,599
81,840,154
5,121,795
16,117,661
76,718,359
3,268,420
8,675,922
24,230,837
23,055,893
9,509,467
6,608,194
1,369,626
48,684,445
16,473,425
2,423,709
6,058,050
7,991,666
21,265,618
32,211,020
10,945,402
7,095,248
5,531,747
8,638,623
2016 p
21.1%
18.8%
21.0%
18.0%
18.7%
38.1%
22.4%
15.7%
20.1%
17.1%
19.3%
23.2%
23.9%
24.1%
41.6%
35.9%
9.2%
23.8%
23.7%
23.7%
20.9%
16.5%
30.6%
2014
21.2%
19.7%
20.3%
18.5%
19.7%
35.1%
24.8%
16.4%
19.1%
17.4%
20.2%
30.4%
23.6%
25.0%
42.3%
37.3%
10.2%
23.7%
22.9%
21.3%
18.9%
21.7%
29.1%
2015
21.1%
20.2%
18.2%
21.4%
20.3%
32.3%
21.6%
16.6%
20.7%
23.1%
19.0%
29.5%
22.8%
23.4%
34.6%
38.7%
8.4%
22.5%
22.4%
22.3%
19.4%
18.1%
27.8%
2016 p
Office Vacancy Rate
(905,638)
(615,383)
88,059
15,030
(703,442)
(151,859)
(378,965)
64,288
(274,063)
(86,554)
101,584
22,127
(290,255)
65,115
61,173
(85,665)
89,607
(492,443)
(355,370)
137,073
(308,316)
194,219
(378,346)
2014
551,239
327,546
74,754
(100,526)
252,792
73,408
41,794
268,104
67,379
5,921
(106,447)
(97,367)
223,693
(327,466)
(17,885)
(227,461)
(82,120)
204,931
551,159
346,228
127,316
(81,594)
159,209
2015
73,640
2016 p
494,676
231,235
80,256
(464,351)
150,979
38,791
464,081
(130,518)
233,757
(569,155)
104,804
9,219
263,441
124,144
3,021
58,176
62,947
156,035
139,297
(16,738)
(146,175)
228,570
Total Annual Absorption
1 Inside the Beltway is comprised of Arlington County and Alexandria/Outside the Beltway is comprised of Fairfax and Loudoun Counties



4 The I-395 and Springfield/Newington submarkets were updated in the second quarter of 2012 with additional inventory.
132,195,668
5,121,795
83,036,435
5,072,696
83,373,563
Loudoun County
Outside the Beltway
16,113,797
77,914,640
3,268,420
9,242,182
9,505,603
6,608,194
1,358,705
49,159,233
49,407,854
Inside the Beltway
Annandale/Baileys
2,742,707
16,992,423
6,058,050
2,742,707
6,293,050
I-395 Corridor
8,191,666
21,221,408
17,227,423
8,191,666
Old Town
City of Alexandria
21,048,500
RB Corridor
32,166,810
10,945,402
7,076,618
Huntingon/Eisenhower
11,131,931
32,180,431
6,820,962
Ballston
Arlington County
5,531,747
8,613,043
8,695,791
Rosslyn
Courthouse/Clarendon/
Virginia Square
5,531,747
2015
Total Office Inventory

2014
Historical Year-End Data
Appendix
Market Statistics
Northern Virginia 3rd Quarter 2016 Market Statistics
Buildings
Total
Inventory
(SF)
New/Relet
Vacancy
(%)
Sublet
Vacancy
(%)
Total
Vacancy*
(%)
Net
Absorption
Current QTR
(SF)
Under
Construction
(SF)
Average
Asking Rent
(FS)
47
7,855,196
18.7%
0.6%
19.3%
27,936
720,000
$35.10
64
6,746,020
31.6%
0.3%
31.8%
13,981
$29.99
27
1,872,209
9.7%
0.6%
10.2%
11,014
$24.68
TOTAL
138
16,473,425
22.9%
0.5%
23.4%
52,931
720,000
$31.14
49
12,757,247
20.2%
0.8%
21.0%
88,859
862,729
$43.14
35
9,378,602
25.2%
0.3%
25.5%
10,446
$40.81
19
2,280,849
29.5%
2.0%
31.5%
(1,470)
$34.97
TOTAL
103
21,265,618
21.7%
0.7%
22.5%
97,835
862,729
$40.87
Alexandria
Class
RB Corridor
Class

Class
A
25
7,794,322
17.5%
0.9%
18.4%
391,584
$39.33
14
3,151,080
31.5%
0.5%
31.9%
(251,295)
$34.86
39
10,945,402
21.5%
0.8%
22.3%
140,289
$37.43
51
13,126,289
19.5%
0.9%
20.4%
76,142
1,751,813
$37.44
61
7,751,416
20.7%
1.3%
21.9%
8,667
$29.47
30
2,178,188
17.7%
0.2%
17.9%
33,703
$24.93
TOTAL
142
23,055,893
19.7%
1.0%
20.7%
118,512
1,751,813
$31.93
106
17,967,174
14.9%
1.8%
16.7%
(42,662)
354,913
$31.06
64
5,589,260
13.7%
1.5%
15.2%
26,300
$25.51
15
674,403
25.9%
0.0%
25.9%
(15,138)
$21.27
TOTAL
185
24,230,837
14.9%
1.7%
16.6%
(31,500)
354,913
$28.88
TOTAL
Tysons
Class
Reston/Herndon
Class
* Vacancy Current - the vacancy rate is calculated using the combined total of vacant direct, sublease and new space.
Market Statistics
Northern Virginia 3rd Quarter 2016 Market Statistics
Buildings
Total
Inventory
(SF)
New/Relet
Vacancy
(%)
Sublet
Vacancy
(%)
Total
Vacancy*
(%)
Net
Absorption
Current QTR
(SF)
Under
Construction
(SF)
Average
Asking Rent
(FS)
Merriield/Route 50
Class
A
20
3,616,798
21.2%
2.3%
23.5%
(58,704)
$31.93
15
1,566,456
19.2%
1.1%
20.3%
(43,809)
$25.78
20
1,424,940
5.9%
0.0%
5.9%
(2,105)
$22.02
TOTAL
55
6,608,194
17.4%
1.5%
19.0%
(104,618)
$30.31
Class
A
25
4,365,706
18.9%
0.0%
18.9%
(17,560)
385,000
$29.65
47
4,410,647
25.4%
1.4%
26.8%
(60,202)
$24.33
12
733,114
25.4%
0.2%
25.6%
(18,950)
$23.54
TOTAL
84
9,509,467
22.4%
0.7%
23.1%
(96,712)
385,000
$25.20
48
6,127,730
18.8%
0.9%
19.7%
232,450
$27.36
27
2,548,192
21.1%
5.1%
26.2%
14,531
$23.13
75
8,675,922
19.4%
2.1%
21.6%
246,981
$25.91
Route 28 South
Class
TOTAL
Loudoun County
Class
A
40
3,658,941
14.6%
1.1%
15.7%
8,322
64,800
$25.83
18
1,462,854
22.9%
1.5%
24.5%
1,613
$21.19
58
5,121,795
17.0%
1.2%
18.2%
9,935
64,800
$24.37
TOTAL
Northern Virginia
Class
A
426
79,581,628
18.5%
1.1%
19.6%
733,876
4,139,255
$34.83
352
40,064,494
23.2%
1.1%
24.4%
(282,326)
$30.50
144
10,878,477
19.9%
0.6%
20.5%
(8,562)
$26.92
TOTAL
922
130,524,599
20.1%
1.1%
21.1%
442,988
4,139,255
$32.24
* Vacancy Current - the vacancy rate is calculated using the combined total of vacant direct, sublease and new space.
JBG
Carr Properties
Marymount University
1201 Wilson Boulevard
2311 Wilson Boulevard
1000 North Glebe Road
Lowe Enterprises
2401 Eisenhower Avenue
Navy Federal Credit Union
Peterson Companies
1041 Electric Avenue
4097 Monument Corner Drive
U/R = Under Renovation
NNN = Net of all Operating Expenses and Taxes
= Plus Electric NT = Plus Taxes
= Full Service NN = Plus Electric & Char
Operating Expense and Real Estate Tax Base
FS
Status
N/A
N/A
RENTAL RATE
N/A
RENTAL RATE
N/A
N/A
N/A
RENTAL RATE
U/C = Under Construction
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Alexandria
Total
OWNER/DEVELOPER
BUILDING ADDRESS
RB Corridor
3Q17
2Q17
DELIVERY
DATE
1Q17
DELIVERY
DATE
2Q17
3Q17
3Q17
DELIVERY
DATE
N/A = No Space Available
U/C
U/C
STATUS
U/C
STATUS
U/C
U/C
U/C
STATUS
131,172
56,631
174,962
166,767
150,000
235,000
235,000
AVAILABLE
SPACE
RENTABLE
BUILDING AREA
720,000
720,000
AVAILABLE
SPACE
RENTABLE
BUILDING AREA
383,503
195,700
521,000
862,729
AVAILABLE
SPACE
RENTABLE
BUILDING AREA
Northern Virginia Survey of Office Space Under Construction/Under Renovation
100%
100%
100%
PERCENT
PRELEASED
100%
100%
PERCENT
PRELEASED
56%
64%
25%
62%
PERCENT
PRELEASED
Apple Federal Credit Union
Navy Federal Credit Union
MAJOR TENANTS
National Science Foundation
MAJOR TENANTS
Marymount University
Opower
CEB
MAJOR TENANTS
Capital One
Meridian Group
MITRE
Capital One Tower
8350 Broad Street
Colshire Drive / MITRE IV
Comstock Partners
1900 Reston Metro Plaza
Oaklawn Development Partners
309 Kellys Ford Plaza SE
4Q16
DELIVERY
DATE
2Q17
DELIVERY
DATE
4Q16
1Q18
3Q18
DELIVERY
DATE
U/R = Under Renovation
FS
Status
U/C = Under Construction
0
738,416
738,416
AVAILABLE
SPACE
3,702,442
975,000
2018 DELIVERIES
2019 DELIVERIES
TOTAL CURRENTLY UNDER CONSTRUCTION/RENOVATION
404,800
RENTABLE
BUILDING AREA
64,800
64,800
AVAILABLE
SPACE
RENTABLE
BUILDING AREA
354,913
354,913
354,913
354,913
AVAILABLE
SPACE
352,371
352,371
AVAILABLE
SPACE
RENTABLE
BUILDING AREA
1,751,813
340,000
436,813
975,000
RENTABLE
BUILDING AREA
2,322,642
U/C
STATUS
U/C
STATUS
U/C
U/C
U/C
STATUS
2017 DELIVERIES
N/A
RENTAL RATE
N/A
RENTAL RATE
N/A
N/A
N/A
RENTAL RATE
2016 DELIVERIES
Northern Virginia
Summary
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Leesburg
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Reston/Herndon
Total
OWNER/DEVELOPER
BUILDING ADDRESS
Tysons Corner
Northern Virginia Survey of Office Space Under Construction/Under Renovation
80%
0%
100%
68%
100%
PERCENT
PRELEASED
100%
100%
PERCENT
PRELEASED
0%
0%
PERCENT
PRELEASED
80%
100%
100%
100%
PERCENT
PRELEASED
EIT, LLC
MAJOR TENANTS
N/A
MAJOR TENANTS
MITRE
Tegna
Capital One
MAJOR TENANTS
Lerner Enterprises
The Alter Group
1775 Tysons Boulevard / The

Corporate Office Centre @ Tyssons
II
4850 Stonecroft Boulevard / The

Crossroads at Westfields II
Merritt Properties, LLC
LGV Group
Comstock Holding Companies, Inc
Corporate Office Properties Trust
20193 Ashbrook Pl
22365 Broderick Dr
43777 Central Station Dr
4870 Stonecroft Blvd
FS = Full Service NN = Plus Electric & Char

N = Plus Electric NT = Plus Taxes
Total
OWNER/DEVELOPER
BUILDING ADDRESS
2015 Deliveries
Total
OWNER/DEVELOPER
BUILDING ADDRESS
2016 Deliveries
N/A
$28.50
$22.75
N/A
RENTAL RATE
N/A
N/A
RENTAL RATE
Route 28 South
Loudoun
Loudoun
Loudoun
SUBMARKET
Tysons Corner
SUBMARKET
*Vacancy rate for new space- does not include relet or sublet space available
Delivered 3Q15
Delivered 1Q15
Delivered 1Q15
Delivered 1Q15
STATUS
Delivered 1Q16
Delivered 2Q16
STATUS
Northern Virginia Survey of New Office Space
13,045
32,690
0
35,368
99,099
159,300
45,735
32,675
326,442
NEW SPACE
AVAILABLE
282,212
160,000
122,212
NEW SPACE
AVAILABLE
RENTABLE
BUILDING
AREA
635,809
160,000
475,809
RENTABLE
BUILDING
AREA
14%
0%
33%
37%
0%
VACANCY RATE (AS

OF CURRENT
QUARTER)*
44%
0%
26%
VACANCY RATE (AS

OF CURRENT
QUARTER)*
77%
100%
50%
26%
100%
PERCENT LEASED
UPON DELIVERY
56%
100%
39%
PERCENT LEASED
UPON DELIVERY
Pentagon Federal Credit Union
KBS Realty Advisors
Macerich
7940 Jones Branch Dr
3001-3003 Washington Blvd
7900 Tysons One Pl
Monday Properties
Lowe Enterprises
Monument Enterprises
Rubenstein Partners, LP
Halle Enterprises
Beulah Street LLC II
Zumot Real Estate Management
Duke Realty
1812 North Moore Street
1400 Crystal Drive
901 South Clark Street
7951-7961 Loisdale Road
5680 King Center Drive
6400 Beulah Street Office II
14399 Penrose Place
4801 Stonecroft Boulevard
60,244
528,290
*Vacancy rate for new space- does not include relet or sublet space available
Route 28 South
Route 28 South
Pentagon City
Crystal City
Rosslyn
SUBMARKET
230,401
0
221,316
70,447
2,353
26,952
0
308,898
332,084
242,272
110,047
35,000
104,000
254,578
1,086,850
535,381
535,381
1,922,260
NEW SPACE
AVAILABLE
RENTABLE
BUILDING
AREA
126,170
65,926
306,007
Clarendon/Courthouse/VA
Square
1,130,554
296,257
Tysons
Tysons
NEW SPACE
AVAILABLE
RENTABLE
BUILDING
AREA
SUBMARKET
N/A
$29.50 FS
$32.00 FS
$34.50-$37.50
Withheld
N/A
$44.00-$52.00 FS
$50.00-$65.00 FS
RENTAL RATE
$55.00-$65.00
Withheld
N/A
RENTAL RATE
Delivered 2Q13
Delivered 2Q13
Delivered 3Q13
Delivered 3Q13
Delivered 3Q13
Delivered 4Q13
Delivered 3Q13
Delivered 4Q13
STATUS
Delivered 2Q14
Delivered 1Q14
Delivered 4Q14
STATUS
FS
Total
OWNER/DEVELOPER
BUILDING ADDRESS
2013 Deliveries
Total
OWNER/DEVELOPER
BUILDING ADDRESS
2014 Deliveries
Northern Virginia Survey of New Office Space
57%
0%
26%
23%
64%
100%
0%
75%
100%
VACANCY RATE (AS

OF CURRENT
QUARTER)*
11%
11%
22%
0%
VACANCY RATE (AS

OF CURRENT
QUARTER)*
33%
100%
25%
67%
0%
0%
100%
0%
0%
PERCENT LEASED
UPON DELIVERY
47%
44%
48%
53%
PERCENT LEASED
UPON DELIVERY
Methodology & Definitions

Methodology
Explanation of Terms
Market statistics are calculated

from a base building inventory
made up of office properties
deemed to be competitive in the
typical Washington, DC office
market. Single-tenant buildings and
privately-owned buildings in which
the federal government leases space
are included.
Generally, owneroccupied
and
federally-owned
buildings are not included. Older
buildings unfit for occupancy or ones
that require substantial renovation
before
tenancy
are
generally
not included in the competitive
inventory. Vacant space is defined
as space that is physically vacant and
available immediately. Sublet space
still occupied by the tenant is not
counted as vacant space.
Total Inventory: The total amount

of office space (in buildings greater
than 10,000 square feet) that can be
rented by a Fourth party.
New Space Vacant: First generation,
never-occupied office space in
newly constructed or substantially
renovated buildings, being actively
marketed by a landlord.
Relet
Space
Vacant:
Secondgeneration,
unoccupied
office
space being actively marketed by a
landlord. (Space that is marketed but
largely occupied is not counted as
vacant space.)
Sublet Space Vacant: Secondgeneration, unoccupied space being
actively marketed by a tenant.
(Sublet space that is marketed but
still occupied is not counted as
vacant space.)
Total Space Vacant: The sum of
new, relet, and sublet space that
is unoccupied and being actively
marketed.
Vacancy Rate: The amount of
unoccupied space (new, relet, and
sublet) expressed as a percentage of
total inventory. (Total Space Vacant
divided by Total Inventory.)
Total Space Available: The total

amount of space, both vacant and
occupied, being actively marketed
for lease by a tenant or landlord.
(This includes space that is currently
occupied but marketed for future
availability.)
Availability Rate: The total amount
of space being actively marketed for
lease (both vacant and occupied)
expressed as a percentage of total
inventory. (Total Space Available
divided by Total Inventory.)
Absorption: The net change in
occupied space between two points
in time. (Total occupied space in the
previous quarter minus total occupied
space in the current quarter, quoted
on a net, not gross, basis.)
New/Relet/Sublet Absorption: The
net change in occupied new, relet,
and sublet space between two
quarters.
Total Absorption: The net change
in total occupied (new, relet, and
sublet) space between two quarters.
New Leasing Activity: The sum of
all square footage underlying any
leases between two quarters. This
includes pre-leasing activity as well
as expansion. It does not include
renewals.
Disclaimer
This report and other research materials may be found on our website at www.cushmanwakefield.com. This is a research
document of Cushman & Wakefield in Washington, DC. Questions related to information herein should be directed to the
Research Department at +1 202 463 2100. Information contained herein has been obtained from sources deemed reliable and
no representation is made as to the accuracy thereof.
About Cushman & Wakefield
Cushman & Wakefield is a leading global real estate services firm that helps clients transform the way people work, shop, and
live. Our 43,000 employees in more than 60 countries help investors and occupiers optimize the value of their real estate by
combining our global perspective and deep local knowledge with an impressive platform of real estate solutions. Cushman
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agency leasing, asset services, capital markets, facility services (C&W Services), global occupier services, investment & asset
management (DTZ Investors), project & development services, tenant representation, and valuation & advisory. To learn more,
visit www.cushmanwakefield.com or follow @CushWake on Twitter.
Visit cushmanwakefield.com for more information on the full range of

Cushman & Wakefield commercial real estate services or contact:
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+1 202 463 2100
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+1 202 463 2100
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Research Analyst
+1 202 463 2100
About Cushman & Wakefield

Cushman & Wakefield is a leading global real estate services firm that helps clients
transform the way people work, shop, and live. Our 43,000 employees in more than
60 countries help investors and occupiers optimize the value of their real estate by
combining our global perspective and deep local knowledge with an impressive
platform of real estate solutions. Cushman & Wakefield is among the largest
commercial real estate services firms with revenue of $5 billion across core services
of agency leasing, asset services, capital markets, facility services (C&W Services),
global occupier services, investment & asset management (DTZ Investors), project &
development services, tenant representation, and valuation & advisory. To learn more,
visit www.cushmanwakefield.com or follow @CushWake on Twitter.
Publication date: 6.2.16

Copyright 2016 Cushman & Wakefield. All rights reserved.
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Market Report

Northern Virginia | 3rd Quarter 2016

DC Metropolitan Area Overview..............................................................................3

Cushman & Wakefield | 2

Washington, DC Metropolitan Area

While the narrative about job growthas well as the midterm

Average Asking Rent (FS)

Net Absorption/Asking Rent

Net Absorption, MSF

Asking Rent, $ PSF

Washington, DC Metropolitan Area

The Washington, DC metropolitan regions (DC Metro) economy

We have the jobs...Now where is the Absorption?

Metropolitan Washington, DC continued to post strong job

Net Absorption/Asking Rent

Job growth, typically a leading economic indicator, finally

appeared to be having an impact on the Northern Virginia real

estate market, as office space has experienced 494,676 square

feet (SF) of positive year-to-date absorption. Class A product has

Drive (due to undergo extensive renovations) to occupy 370,000

SF at 1215 South Clark Street. Overall vacancy closed the third

quarter of 2016 at 21.1%, unchanged from one year ago. Direct

Net Absorption, MSF

asking rental rates in NoVA stood at $32.24 per square foot, a

Asking Rent, $ PSF

Predictive Technologies signed the largest lease of third quarter

Union). Opower signed a 44,900-SF prelease in the first quarter

Large Blocks of Contiguous Space

Cushman & Wakefield | 4

Northern Virginia Office Submarkets

VIRGINIA SQUARE - GMU

FAIR FAX COUN

4250 North Fairfax Drive

Applied Predictive Technologies

1775 Tysons Boulevard

1765 Greensboro Place

Key Sales Transactions 3Q 2016

Republic Park #1-8

Liberty Property Trust/MRP Realty

Westbrook Partners/Rosenthal Properties & Wafra

Carr Properties/Tritower Financial

Northern Virginia Office Market

Northern Virginia Office Market

Net Absorption - Deliveries - Vacancy, Third Quarter 2016

Inventory and Vacancy by Submarket, Third Quarter 2016

Square Feet (Millions)

AlexandriaRB CorridorCrystal City TysonsReston/Herndon50/66

Cushman & Wakefield | 6

The Old Town market continued to improve in the third quarter,

Net Absorption Deliveries Vacancy

years. As a whole, Alexandria has registered 124,100 SF of positive

Square Feet, 000s

year-to-date absorption, mainly due to demand from Old Town.

Alexandria posted a large win in the third quarter, convincing

as vacancy hit 8.4%, the submarkets lowest vacancy in over five

conducted a multi-jurisdictional search before deciding to stay

Old Town Vacancy Rate

in the building it has occupied since 2005. A condition of the

New Leasing Activity

leases of the third quarter included Virginia Hospital Centers

17,784-SF new lease at 2800 Shirlington Road and Cotton &

renovations, as it seeks to reposition itself to better compete in a

The 335,000-SF Carlyle Tower is in the throes of comprehensive