NAIOP MID-YEAR FORECASTNorthern VirginiaJuly 2017
NAIOP MID-YEAR FORECASTNorthern VirginiaJuly 2017
-30
-20
-10
0
10
20
30
40
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Jan Feb Mar Apr May
NE
W J
OB
S I
N T
HO
US
AN
DS
JOB GROWTHNorthern Virginia
Source: Bureau of Labor Statistics, Transwestern.
12 Months Ending – 201726,100 Jobs Year-Over-Year
10-Year Average Annual Growth13,000 Jobs Per Year
-4 -2 0 2 4 6 8 10 12 14
Information
Other Services
Manufacturing
Federal Government
Wholesale/Transportation/Utilities
Retail Trade
Financial Services
Leisure/Hospitality
State and Local Government
Construction/Mining
Education/Health
Professional/Business Services
2017 - Year-Over-Year Average
Recovery Period - Since Q2 2009
A N N U A L J O B G R O W T H I N T H O U S A N D S
JOB GROWTH BY SECTORNorthern Virginia
Source: Bureau of Labor Statistics, Transwestern.
7,000
19,100 17,800
0
5,000
10,000
15,000
20,000
25,000
2007 to 2011 2012 to 2016 2017 to 2021
AV
ER
AG
E A
NN
UA
L JO
B G
RO
WT
HJOB GROWTH PROJECTIONNorthern Virginia
Source: Bureau of Labor Statistics, Moody’s, Transwestern.
10-Year Average13,000
Source: Bureau of Labor Statistics, Moody's, Transwestern.
23.0% 24.2% 25.9% 27.1%
54.6% 53.4% 51.9% 50.3%
22.4% 22.5% 22.2% 22.2%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2007 2012 2016 2021
Arlington/Alexandria
Fairfax
Loudoun/Prince William
SHARE OF JOBSNorthern Virginia
Source: Woods & Poole, Moody’s, Transwestern.
0 5 10 15 20 25
Manufacturing
Federal Government
Wholesale/Trans/Utilities
Information
Education
Construction/Mining
Other Services
Financial Services
Health
State and Local Government
Leisure/Hospitality
Retail
Professional/Business Services
J O B G R O W T H I N T H O U S A N D S
PROJECTED JOB GROWTH Northern Virginia | 2017-2021
$36.1
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*
IN B
ILLI
ON
SPROCUREMENT SPENDINGNorthern Virginia
*First quarter annualized.
Source: FPDS, Transwestern.
Source: FPDS, Transwestern.
55%
71%84%
11%
6%
2%
9%
3%
4%
4%3%
3%21% 17%8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Arlington/Alexandria Fairfax Loudoun/Prince William
Balance of Agencies
Justice
State
Health and Human Services
Defense/Homeland/Veterans
SHARE OF PROCUREMENT SPENDINGNorthern Virginia | 2016
$8.9Total Procurement In Billions $24.3 $4.2
18%
17%
17%13%
9%
7%
5%
5%
5%4%
Reston/Herndon
Loudoun County
Tysons Corner
Route 28 Corridor South
RCB Corridor
Merrifield
Fairfax Center
Crystal City/Pentagon City
Springfield/Huntington
Balance of Submarkets
TOP GOVERNMENT CONTRACTOR LOCATIONNorthern Virginia | 2017
Source: WBJ, CoStar, CompStak, Transwestern.
0
5
10
15
20
25
07 08 09 10 11 12 13 14 15 16 17 18 19
Flex/Industrial
Multifamily
Office
Retail
DEVELOPMENT PIPELINE Northern Virginia
Source: CoStar, Transwestern.
IN M
ILLI
ON
S O
F S
F
DEVELOPMENT PIPELINE – PROJECTS UNDER CONSTRUCTION Northern Virginia
Office
Multifamily
Flex/Industrial
Retail
Source: CoStar, Transwestern.
-6
-4
-2
0
2
4
6
8
10
Office Flex/Industrial Retail Multifamily
New Construction
Class A
Class B
NET ABSORPTION SINCE 2010Northern Virginia
Source: CoStar, Transwestern.
IN M
ILLI
ON
S O
F S
F*
*Multifamily in 10,000 SF.
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
07 08 09 10 11 12 13 14 15 16 17*
Office
Flex/Industrial
Multifamily
Retail
VACANCY RATENorthern Virginia
Source: CoStar, Delta Associates, Transwestern.
*Second quarter 2017.
Vacancy Rate at Q2 2017:Annual Rent Growth Since 2010:
OFFICE METRICS BY LOCATIONNorthern Virginia
0.5 MILE TO XX 14.8% 1.2%
MIXED-USE9.3% 1.8%
NORTHERN VIRGINIA15.9% 0.8%
Source: CoStar, Transwestern.
Source: CoStar, Transwestern.
0% 5% 10% 15% 20% 25% 30%
Tech
Government
Health
Financial Services
Consulting
Tech
Consulting
Government
Financial Services
S H A R E O F L E A S I N G
TOP THREE OFFICE TENANT SECTORS LEASING BY CLASSNorthern Virginia | Since 2010
Clas
s ANe
w Co
nstru
ctio
nCl
ass B
$20
$25
$30
$35
$40
$45
07 08 09 10 11 12 13 14 15 16 17*
New ConstructionClass AClass B
OFFICE ASKING RENTSNorthern Virginia
Source: CoStar, Transwestern.
*Second quarter 2017.
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
2002 to 2007 Recovery 2008 to 2009 Recession 2010 to 2017 Recovery
To Northern Virginia From DC
To DC From Northern Virginia
OFFICE RELOCATIONSNorthern Virginia vs. District of Columbia
Source: CoStar, Downtown BID, Transwestern.
IN M
ILLI
ON
S O
F S
F
-400
-300
-200
-100
0
100
200
300
07 08 09 10 11 12 13 14 15 16 17*
Office
Flex/Industrial
Multifamily
Retail
MARKET INDEXNorthern Virginia
Source: Transwestern.
Land
lord
Mar
ket
Tena
nt M
arke
t
*Second quarter 2017.
Flat Market Conditions
7900 Tysons One Place, Suite 600McLean, VA 22102
