Trading cubicles for suites? The new class-A office paradigm

Key points:

• • Class-A office is outperforming as tenants consolidate into higher-quality, amenity-rich buildings despite elevated overall vacancy.
• • New construction has slowed sharply while demolitions and conversions rise, tightening supply of top-tier space.
• • Investor activity reflects this selectivity, with A and A+ assets gaining value as older inventory faces refinancing and repositioning pressure.

March 2026 — As the national office market struggles to find its balance, one segment continues to run ahead of the pack: the top-end class-A office.

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While vacancy rates remain elevated overall, and older office stock continues to struggle, class-A properties in strong locations are leasing more consistently as companies focus on improving the quality of their workplace environments.

“The office sector is showing signs of stabilization, with the flight-to-quality driving demand for class-A properties that align with tenant needs,” said Kevin Welsh, executive managing director at Newmark in New Jersey, during an interview with Invest: New Jersey, 

That shift is becoming more visible across regions. Rather than expanding their footprints, many tenants are consolidating into fewer, better buildings, prioritizing amenities, location, and employee experience over sheer square footage.

Adjusting Through Supply

Part of the stabilization in the class-A office space is tied to supply. Development activity has slowed significantly. U.S. office completions are projected to fall by 75% this year, and most of the remaining pipeline is already pre-leased.

At the same time, more office space is being removed from the market than added. CBRE data reports that 23.3 million square feet of office space is slated for demolition or conversion this year, compared to just 12.7 million square feet of new construction in the largest U.S. markets. This marks a notable turning point after decades of steady expansion.

While overall national vacancy remains around 18% since the beginning of 2026, the contraction of outdated inventory is gradually helping to rebalance the market, particularly for higher-quality assets.

In practical terms, there is less new top-tier supply coming online, and much of what does deliver is already committed.

Flight to Quality 

Across markets, leasing activity continues to concentrate in modern, amenity-rich buildings.

In Pittsburgh, Mamadou Baldé, managing director at CBRE, has seen this divergence intensify. “Everyone is dealing with the flight to quality. Class B is facing challenges that increase vacancies, while class-A demand remains healthy for amenity-rich buildings,” he said in an interview with Invest: Pittsburgh.

Tenants are often taking less space than they did pre-pandemic, but they are choosing higher-quality properties. Cushman & Wakefield data shows that among class-A+ buildings, peak midweek usage has recovered to 93% of pre-pandemic levels. Additionally, roughly half of all class-A U.S. office buildings are either fully occupied or maintain vacancy rates below 10%.

In a conversation with Invest: Greater Orlando, Andrei Savitski, executive vice president at CBRE, describes 2025 as a pivotal year for recovery. “Tenants are concentrating heavily on class-A buildings, and the gap between class-A and lower-quality assets continues to widen.”

This pattern suggests that demand has not disappeared, it has become more selective.

Why Experience Now Matters More Than Ever

A key reason behind sustained class-A Office demand is the growing emphasis on workplace experience.

JLL research indicates that 73% of employees say more greenery near their workplace would improve well-being, and 74% prefer spaces that feel personalized. Importantly, when employees rate their workplace experience positively, 84% also feel supportive of attendance expectations.

In other words, companies are recognizing that if they expect employees to return to the office more consistently, the space itself has to offer something meaningful.

Modern class-A buildings are increasingly designed around this reality. Features such as wellness amenities, collaborative common areas, integrated retail, walkable neighborhoods, and technology-enabled access are no longer considered luxuries; they are part of the competitive equation.

JLL also notes that offices located in lifestyle districts can command a 32% rental premium in the United States, reflecting the value tenants place on proximity to restaurants, entertainment, and transit.

Investment Activity Reflects Selectivity

Capital markets are responding accordingly.

Prices for A and A+ office properties increased 7.5% year-over-year in 2025, outperforming lower-tier assets. Cushman & Wakefield describes the current cycle as a “generational reset,” particularly for well-located, modern buildings that may face limited future competition due to historically low construction starts.

In South Florida, Jordan Rathlev of Related Ross highlighted how lifestyle class-AA+ offices became a central focus of development strategy, reflecting long-term confidence in high-quality assets.

“When the pandemic hit, we purchased and built a considerable amount of class-A office space. As migration accelerated, we expanded our focus to include luxury rentals, affordable housing, lifestyle class-AA+ office, luxury condominiums, as well as new retail and hotel developments”, Rathlev told Invest: Palm Beach.

Meanwhile, lower-quality buildings continue to face refinancing pressure and may require renovation, repositioning, or conversion to alternative uses.

A More Selective Recovery

The office market is not recovering evenly, and challenges remain for older inventory. However, the data suggests that class-A buildings, particularly those in walkable, amenity-rich environments, are stabilizing faster and, in many markets, performing relatively well.

With office construction starts totaling just 0.2% of inventory over 2025, and demolition outpacing new deliveries, the long-term supply of trophy office space is becoming more constrained.

As tenants continue to prioritize quality, flexibility, and employee experience, class-A office demand appears positioned to remain resilient. The broader sector may still be adjusting, but the highest-performing buildings are demonstrating that when the product aligns with tenant expectations, leasing activity follows.

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