2025 Q4 Columbia Office Report

The Columbia market saw healthy demand for the market’s highest-quality spaces, even as fourth-quarter moveouts generated the market’s first negative quarter of absorption since early 2024, according to Colliers, the commercial real estate firm.

Colliers said Class A properties posted 84,673 square feet of gains as overall Class A asking rents reached a record high at $29.41, driven by tenants focused on downtown properties as CBD Class A vacancy fell to just 5.29 percent.

Simultaneously, the October sale of 1441 Main St. was the market’s most notable downtown transaction in several years, opening a window for residential and structured parking development on its attached surface lots, Colliers said in its report.  

Colliers said redevelopment also may drive the next phase for other aging buildings: Seibels’ former headquarters reached full vacancy, the quarter’s single largest negative absorption component, in a building with potential for hotel or residential conversion.

It said redevelopment also took root at the city of Columbia-owned Washington Square office building, which went under contract for high-end hotel redevelopment amid a growing wave of downtown capital investment.

Amid spiking rent growth driven by the region’s broader momentum and Class A inventory shortage, a window may be opening for new construction with the Bull Street District the most likely target, Colliers said.  

Looking ahead, it said rent growth is unlikely to achieve the sharp spike seen in 2025, while demand is likely to remain steady as federal tenants assess changing space needs as part of a nationwide shakeup.

Total inventory remained steady at 13,710,720 square feet as Palmetto Citizens FCU’s 104,000-square-foot headquarters remained the only active construction.

New vacancy at the Seibels building contributed to -168,748 square feet of net absorption, pushing vacancy to 12.27 percent though still lower than the year’s start, Colliers said.

Overall office rents remain at $19.70 due to a preponderance of Class C space, though CBD Class A rents grew over 20 percent annually.