Downtown Bellevue’s office vacancy rate was 23.7% at the end of the third quarter of 2026, but about 755,000 square feet of that empty space has already been leased to tenants who have not yet moved in, according to Broderick Group’s Q3 2026 Eastside Office Market Report. Broderick says that is the most leased-but-empty space it has on record, and that it means the headline vacancy rate “overstates true market softness.” The report also projects that 2026 will be downtown’s strongest year in a decade for office space leased and taken off the market.
Of the roughly 15.25 million square feet of office space in the Bellevue central business district, about 3.62 million square feet sits vacant. Leave out the space already spoken for, and about 2.86 million square feet, or 18.8% of downtown office space, is vacant and still available, according to a Downtown Bellevue Network calculation based on the report’s figures.
That leased space will count as occupied once tenants move in. Broderick expects the vacancy rate to improve over the next several quarters as those leases begin, even if no new leases are signed.
Third-Quarter Numbers
Downtown vacancy was nearly unchanged from 23.6% in the second quarter. Availability, a measure that also includes occupied space being offered for lease, rose to 22.7% from 22.3%. Net absorption, which tracks the change in occupied space, was negative downtown at about 128,500 square feet for the quarter.
According to Broderick, leasing took roughly 10 floors off the downtown market during the quarter, but Bungie’s sublease of its space at the Bellevue Connection balanced that out. The report names Databricks’ lease of about 142,000 square feet at Four106 as the quarter’s standout downtown deal.
Across the entire Eastside, office vacancy rose to 22.4% from 21.1% in the second quarter, and net absorption was negative at about 293,000 square feet. Broderick attributes the increase mainly to the addition of Spring District Block 5 (327,000 square feet) and Spring District Block 13 (212,000 square feet), along with the Bungie sublease.
Leasing So Far in 2026 Matches All of 2018
Through the third quarter, leasing has taken about 503,000 square feet of downtown office space off the market in 2026, the same amount as all of 2018. If that pace holds through the fourth quarter, Broderick projects the total will reach about 670,000 square feet, the most in a decade.
The report notes that 2018 and 2019 are often remembered as the market’s best years because vacancy was low. Measured by the amount of space leased and taken off the market, though, 2026 is ahead of both.
Forecast for 2027 and 2028
Broderick expects downtown net absorption to reach about 1.2 million square feet in 2027. About 60% of that, roughly 714,000 square feet, comes from leases of a full floor or more that are already signed but not yet occupied. Another 462,000 square feet or so is tied to tenants whose deals are pending or whose searches are well underway.
Assuming 150,000 square feet of new demand in 2027 and 300,000 square feet in 2028, Broderick projects downtown vacancy will drop to 16.6% in 2027 and 15.0% in 2028. The forecast already accounts for space tenants are expected to give back, and few large leases are set to expire during that time.
