Office conversions and demolitions now exceed new office construction

For the first time since at least 2018, more U.S. office space will be removed through conversions and demolitions than added via new construction, signaling market stabilization. In 2025, 23.3 million sq. ft. will be removed versus 12.7 million sq. ft. added. Multifamily conversions dominate, making up 76% of projects, adding thousands of housing units. Positive absorption and increased leasing suggest a slow recovery despite high vacancy rates.