The percentage of vacant office space in the Greater Des Moines area shrunk slightly between the first and fourth quarters of 2023, market reports from CBRE Inc. and JLL show.

The Des Moines area has over 21.7 million square feet of office space, according to CBRE, which has an office in West Des Moines. In 2023’s first quarter, which ended March 31, 17.2%, or 3.1 million square feet, was vacant. In the fourth quarter, which ended Dec. 31, 12.9%, or 2.8 million square feet was vacant, according to the report.

Part of the decline in vacant office space is due to purchases of office buildings by the state of Iowa and city of Des Moines. The state purchased a two-story, 139,000-square-foot office building for $18 million in September. The building will be occupied by the departments of agriculture and natural resources. In December, the city of Des Moines finalized its purchase of the five-story, 371,920-square-foot office building at 1200 Locust St. The city paid $30 million for the property.

Additional vacant office space is expected to be occupied in 2024, according to a report by JLL, which has an office in downtown Des Moines. Iowa-based Fareway grocery store is relocating its headquarters from Boone to Johnston, where it bought an existing office building. Heartland Co-op is relocating its headquarters from leased space to an office building it acquired from Wells Fargo.

Little new office construction is expected to occur in 2024, according to JLL’s report. “The construction pipeline has dried up with only a few suburban for lease projects being developed,” the report said. “Look for developers to find opportunities to develop additional suburban office projects.”

To read JLL’s market report, click here.
To read CBRE’s market report, click here.