Callahan Capital Partners - Office Real Estate Digest

Callahan Capital Partners is a real estate private equity firm and operator focused exclusively on the origination, acquisition and management of high quality office assets in select urban markets throughout the United States.

“Office-seeking companies leased an estimated 115 million square feet in the first three months of 2025… This was a 13% increase from the prior quarter and the most since the middle of 2019, offering the strongest evidence to date that a sector-wide recovery is underway as companies set their expectations for office attendance and space utilization.”

Despite the slightly smaller lease footprints, a surge in leasing volume at the start of 2025 propelled national leasing square footage to levels not seen since pre pandemic. Read more on CoStar.

“Trophy rents can command a 25% to 40% premium over Class A within these submarkets, suggesting that owners of dated properties in corridors with high supply barriers and healthy leasing conditions have a significant opportunity to renovate.”

Newmark’s recent insight report, Winning Office: Where U.S. Office Space is Thriving and Why, makes the point that not all office assets, markets and submarkets are created equal. In this environment it’s important to recognize market trends, and which assets have the ability to rise to premium status with reinvestment. Per the report, “what is resilient and currently outperforming will gain additional strength—and value—as macro leasing conditions improve and prices rise.”

“You can’t time the bottom perfectly, but now is a good time to be a buyer for well-located assets that may need some improvement,”

The New York Times reports on the worst being probably over for the right type of office. Well-located, high-end properties are alive and well, and the demand will spill to assets a tier below as well in certain markets. While it’s clear not all office properties will experience revived demand, older assets that are well located should benefit from increased leasing demand if repositioned with the right amenities.

Charts We Are Talking About

Encouraging leasing volume metrics in select markets show the benefit of being a national “sharp shooter” for office opportunities and being able to select assets in locations with positive leasing momentum.

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