The Lights Are Coming Back On

I drove past a parking garage on K Street last week — one of those mid-block structures that's been half-empty since 2020. Wednesday afternoon. Every level had cars on it. Not full. But fuller than I've seen it in years. Something's shifting.

TikTok just told every employee in the country to show up five days a week starting next month. Not three. Not four. Five. The same company that closed a 145,000-square-foot office on Music Row in Nashville two weeks ago and laid off 250 people is now telling the rest of its workforce to stop working from the couch. They're joining Amazon, Snap, and Instagram, which already made the same call.

And here's what matters for the DMV. The federal government started this wave back in January 2025 with its own five-day mandate. Keycard swipes downtown jumped 7 percent year-over-year almost immediately. DC hit a new post-pandemic occupancy high. Northern Virginia climbed too. The dominoes started falling, and private companies watched.

Now they're following.

A KPMG survey found that 83 percent of CEOs expect a full return to office — up from 64 percent just two years earlier. A separate national study showed hybrid mandates dropping from roughly 80 percent of companies to about 40 percent. The direction is clear. The debate is over. The only question left is how fast the space fills.

These companies never stopped paying rent. Every month that an office sat at half capacity, the lease payment still cleared. The utilities still ran. The cleaning crew still showed up. Paying for a gym membership you don't use doesn't make you healthy — it just makes you broke. At some point, you either cancel or start showing up. Corporate America is choosing to show up.

DC still has a 22.2 percent vacancy rate. That's real. But Q2 2026 posted the first positive net absorption the market has seen in quarters — 65,000 square feet moving in the right direction. The East End picked up 314,000 square feet of occupancy gains this year alone. Trophy buildings with the right amenities are pulling tenants. The older Class B stock is where the pain concentrates.

So who wins? Landlords with quality product in the right locations. Tenants who locked in favorable lease terms during the downturn and now have leverage they didn't expect. And the restaurants, coffee shops, and dry cleaners within walking distance of those filling garages — because office workers don't just occupy desks. They occupy neighborhoods.

The office market didn't die. It just went to sleep with the rent still running. Now the alarm clock is going off, and everybody's getting dressed at the same time.

If you're a tenant sitting on a lease that expires in the next 18 months, are you renegotiating now while you still have leverage — or waiting until every company in your building decides to come back too?

Until next time — Ed