By Boston Real Estate Times
BOSTON–The Boston office market closed out 2025 on a notably stronger footing, recording its highest quarterly leasing activity in four years, a sign that the sector may be stabilizing after a prolonged period of uncertainty. More than 2.3 million square feet of office leases were signed in the fourth quarter, according to JLL’s newly released Q4 2025 Office Outlook.
According to JLL, the surge in late-year leasing activity reflects a market that, while still grappling with elevated vacancy, is showing clear signs of regained momentum. Occupancy losses slowed considerably over the course of 2025, and tenants increasingly opted to renew or relocate within the Boston market rather than shed space, signaling renewed confidence among major employers.
A defining feature of the quarter was the dominance of renewals. More than 57 percent of Q4 leasing activity came from tenants recommitting to their existing space, underscoring a trend toward stability. Major renewals cited in the JLL report included State Street, Dassault Systèmes, and WilmerHale, all of which retained substantial footprints in the region. Dassault Systèmes alone signed for more than 320,000 square feet across two properties in Waltham, while WilmerHale recommitted to 200,000 square feet at 60 State Street in downtown Boston.
The report also highlights selective but meaningful tenant movement within the city. According to JLL, DraftKings signed a deal to relocate into 104,000 square feet at 225 Franklin Street, while DCAMM leased 108,000 square feet at 100 Summer Street, moving from Center Plaza into newer, mid-rise space. These transactions point to continued demand for well-located, second-generation Class A buildings.
Rental rates edged upward as well. Boston office rents increased 1.9 percent year over year in 2025, driven largely by tightening supply in premier assets, according to JLL. The divergence between high-quality, amenity-rich buildings and more commoditized office product continues to widen. In Back Bay, Class A rents climbed 5.5 percent year over year as availability in top-tier buildings tightened. In the Seaport, performance varied sharply by micro-location: Class A buildings near Seaport Boulevard posted direct availability below 7 percent and the city’s highest average rents at $86.21 per square foot, while Class B buildings along Congress and Summer streets saw rents decline 5 percent and availability rise to a record 21.7 percent.
Despite the improved leasing activity, overall fundamentals remain mixed. Net absorption for 2025 totaled negative 912,734 square feet, though JLL notes that occupancy losses have slowed significantly compared to post-pandemic annual averages. Availability remains elevated across much of the market, particularly in commodity office space, where tenant leverage continues to be strong.
Looking ahead, JLL’s outlook is cautiously optimistic. The firm notes that leasing momentum and decelerating occupancy losses have “set the table” for a more active year in 2026. Well-located, highly amenitized buildings are expected to remain landlord-favorable, with owners able to push rents amid dwindling supply, while older and less differentiated office properties are likely to face continued pressure.
According to JLL, the Boston office market is no longer moving in one direction, but instead behaving as two distinct markets—one defined by flight to quality and renewed commitment, and another where oversupply and competition continue to challenge owners.