Office vacancy rates have hit a 45-year high, with predictions that one-quarter of U.S. office space could sit empty by early 2026. Currently, 11 major metros face over $1 billion in empty office space. Philadelphia, while just below this threshold, saw 27.6 million square feet of vacant office space mid-year, translating to an estimated $801 million in lost rent, according to Switch On Business and Cushman & Wakefield data.

Philadelphia’s office vacancy rate has hovered around 20% in 2024. As companies finalize post-pandemic hybrid strategies, insiders expect clearer market trends in 2025 as leases expire. While some vacant spaces are being repurposed, significant unused inventory continues to weigh heavily on the market, costing hundreds of millions in lost revenue.