By Brian French | Orlando Business News | October 20, 2026
Quick Answer
Orlando’s office market has posted three straight quarters of positive net absorption in 2026, its first consistently positive run since 2021, driven by a flight to quality toward Downtown, Class A suburban buildings and tight submarkets like Winter Park. Industrial vacancy has stabilized near 9% to 11% depending on the source, with newer small-bay buildings outperforming. For tenants, leverage depends entirely on submarket and building class. For owners and investors, quality assets are pricing well while older office remains under pressure.
Key Numbers at a Glance
| Metric | Latest Reading | Source |
|---|---|---|
| Office vacancy, Q3 2026 | 16.6% | CBRE |
| Office net absorption, Q3 2026 | +112,000 SF | CBRE |
| Office asking rent, Q3 2026 | $29.67/SF | CBRE |
| Office investment, 2026 YTD | $327 million | Avison Young |
| Industrial vacancy, Q3 2026 | 8.7% to 10.6% | C&W, CBRE |
| Industrial under construction | 3.29 million SF | CBRE |
| Industrial asking rent, Q3 2026 | $10.48/SF | CBRE |
The Big Picture: A Market Turning a Corner
For most of the past five years, Orlando’s office market told a familiar post-pandemic story: rising vacancy, tenants shrinking footprints and older buildings losing occupants. 2026 is the year that story started to change.
CBRE’s latest data shows Q3 2026 net absorption improved to 112,000 square feet, marking a third consecutive positive quarter this year. The longer view explains why that matters. Net absorption was negative in most quarters from 2021 through 2025, with notable losses in 2022 and 2023, before turning consistently positive in 2026.
The first half set the tone. Through Q2 2026 the market had absorbed 243,000 square feet, compared with negative 32,000 square feet over the same period in 2025. That’s the strongest first-half performance the market has recorded in the five-year span CBRE tracks in its current reporting.
Vacancy is following. Orlando office vacancy rose from 13.2% in Q3 2021 to a peak of 17.5% in Q4 2025 before edging down to 16.6% in Q3 2026. Availability, which counts space coming to market before it’s vacant, dropped 100 basis points to 19.5% in the quarter, a sign that occupiers took more space than they gave back.
A Note on the Numbers
Brokerages measure Orlando differently, using different building inventories, size thresholds and class definitions. Cushman & Wakefield puts Q3 office vacancy at 16.7%, down 20 basis points year over year, with average asking rents of $26.74 per square foot. Avison Young pegged vacancy at 18.5% as of its mid-year analysis. The direction is consistent across sources even when the exact figures aren’t, and direction is what tenants and investors should watch.
Why Supply Discipline Is Doing the Heavy Lifting
The single most important factor in Orlando’s office recovery isn’t demand. It’s the near-total absence of new construction.
CBRE reports only 40,000 square feet of office under construction and no deliveries in Q3. Avison Young notes that with no new supply entering inventory, even a few strong quarters of positive absorption can meaningfully move the vacancy rate.
The trophy pipeline is especially thin. Orlando hasn’t delivered a trophy office tower since Truist Plaza at Church Street Station in 2019, and the city’s next trophy building isn’t expected until 2028 at Westcourt, the Orlando Magic’s sports and entertainment district.
That combination of flat supply and modestly rising demand is exactly how office markets recover. It doesn’t require a hiring boom. It just requires that tenants stop shedding space faster than owners can fill it.
Flight to Quality: The Defining Office Trend
Orlando’s office market is no longer one market. It’s two: modern, amenitized buildings in strong locations, and everything else.
Marcus & Millichap describes a widening performance divide, with Class A properties seeing a substantial vacancy reduction in 2025 while availability in mid- and lower-tier buildings stayed flat. The firm expects Class B and C properties to continue losing tenants, with buildings constructed before 1990 facing the most difficulty.
Lease size data shows who’s driving it. Avison Young found that 74% of Orlando leases over 10,000 square feet were signed in trophy or Class A buildings, versus 26% in Class B. Larger employers with recruiting and retention goals are paying up for better space, while smaller tenants are more price-sensitive.
Brokers describe tenants favoring modern floorplates, amenities and flexibility, leaving older buildings to compete mostly on price. Rents reflect the split: CBRE’s average asking rate climbed to $29.67 per square foot in Q3, up from $28.34 the prior quarter, even with vacancy still elevated. Landlords with quality product are holding pricing power. Owners of dated buildings are not.
What’s Pulling Tenants
Recent large commitments illustrate the pattern. In Q2, a large finance company leased 44,000 square feet in Lake Mary/Heathrow and VentureX committed to 27,000 square feet in the same submarket. Downtown is benefiting from headquarters consolidation, including Travel + Leisure’s announced move that will bring hundreds of jobs into the urban core.
Submarket Scorecard
Performance varies dramatically across the metro. Here’s how the key submarkets compare.
| Submarket | Signal | Tenant Leverage |
|---|---|---|
| Winter Park | ~4% vacancy | Very low |
| East Orlando | ~8.5% vacancy | Low |
| Downtown | ~12% vacancy, top rents | Low to moderate |
| Maitland Center | Mixed, value pricing | Moderate |
| Lake Mary/Heathrow | Strong leasing | Moderate |
| Airport/Lake Nona | ~28% to 33% vacancy | High |
Downtown Orlando
Downtown is the metro’s flight-to-quality winner. CBRE recorded Downtown vacancy at 12.2% in Q2, second only to East Orlando, while Downtown asking rents ran $35.05 per square foot. The submarket led all of Orlando in 2025 leasing with nearly 860,000 square feet. In Q1 2026, Downtown Class B vacancy was just 9.9%, versus 12.6% for Class A, a reminder that well-located older buildings can still compete when the location is right.
Downtown also benefits from transit. SunRail access gives Downtown tenants a commuting advantage that suburban submarkets can’t match.
Lake Nona and the Airport Submarket
Lake Nona carries the metro’s highest vacancy, at 28.3% according to Cushman & Wakefield. That gives tenants the most negotiating leverage anywhere in Orlando, while Millenia/MetroWest, Downtown and especially Winter Park at 4.0% remain tight.
The headline number overstates the long-term weakness. Lake Nona’s vacancy is distorted by a small inventory and one huge pending move-in. Siemens Energy is projected to occupy its 242,700-square-foot space at 6876 Marwick Lane in Q1 2027, which will pull metro-wide vacancy lower. Marcus & Millichap called the Siemens Energy lease one of the metro’s largest in the past decade and a signal of demand shifting toward newer suburban space.
For tenants, Lake Nona is the place to negotiate now. Once Siemens moves in, the submarket’s numbers will look very different.
Maitland Center
Maitland is a value submarket in transition. CBRE’s Q4 2025 data showed Maitland Center vacancy at 18.8% with asking rents around $23.86 per square foot, well below Downtown. But activity is building. Maitland Center posted positive net absorption in Q1 2026, and Q2 leasing there reached 129,000 square feet. Engineering firm LJA Engineering signed a 37,000-square-foot lease at 101 Southall Lane in late 2025.
For cost-conscious tenants who still want a central location near I-4 and SunRail, Maitland offers some of the best value-to-access ratios in the metro.
Office Leasing Volume: A Caution Flag
Not every metric is improving. Gross leasing volume has cooled. Cushman & Wakefield reports 2026 leasing reached just over 1.3 million square feet through Q3, compared with 2.0 million square feet the year before. CBRE showed Q3 leasing easing to 520,000 square feet from 890,000 square feet in Q2, though still above any quarter in 2023.
The read: fewer deals are getting signed, but the ones that do are stickier, and fewer tenants are moving out. Net absorption can rise even as leasing slows when move-outs drop. That’s what’s happening in Orlando, and it’s a healthier pattern than a leasing spike driven by tenants shuffling between buildings.
Industrial: Stabilizing After the Supply Wave
Orlando’s industrial market spent 2023 through 2025 absorbing a wave of new construction. That adjustment is largely complete, though the market remains looser than its pre-2023 levels.
The scale of the supply wave was significant. Marcus & Millichap notes that more than 20 million square feet was delivered over a four-year stretch. Vacancy went from a tight 3.0% to 3.5% range through 2022 and early 2023 to today’s double-digit environment by CBRE’s measure, even as asking rents climbed from $7.97 in Q2 2021 to $10.29 in Q2 2026.
Q3 2026 was a holding pattern. CBRE reports vacancy held at 10.6%, while availability improved from 12.8% to 11.9% and net absorption was 25,000 square feet. Cushman & Wakefield, using a different inventory, puts Q3 vacancy at 8.7%, up 50 basis points year over year, with the increase driven mainly by Airport/Lake Nona and Orlando Central Park.
The second quarter was stronger. Lee & Associates reported Q2 net absorption of 996,347 square feet, the best quarter since Q2 2025, and noted the gains were broad-based across submarkets and tenant sizes.
Leasing activity remains healthy overall. The 8.25 million square feet signed in the first three quarters of 2026 exceeded the comparable totals for both 2023 and 2024, according to CBRE.
Construction Is Picking Back Up
After a pause, developers are breaking ground again. CBRE shows space under construction rising from 2.93 million to 3.29 million square feet across 29 properties. Cushman & Wakefield highlighted two major 2026 groundbreakings in the Airport/Lake Nona submarket: the VenturePark Beachline II and III buildings totaling nearly 748,000 square feet, and the 675,000-square-foot Mahogany Pointe Logistics Park.
That’s worth watching. New speculative supply arriving in 2027 could slow the vacancy recovery in the airport corridor, the same area currently driving vacancy higher.
The Small-Bay Story: Newer Wins, Older Struggles
Small-bay industrial, typically buildings or units under 50,000 square feet serving local distributors, contractors and service businesses, is often described as the strongest segment in Orlando. The reality is more nuanced.
Marcus & Millichap reports that sub-50,000-square-foot spaces recorded negative net absorption in early 2026, driven by steep move-outs from pre-1980 buildings. In contrast, newer small-bay inventory saw more stable demand, keeping overall segment vacancy in the mid-5% range. That’s roughly half the overall market rate.
Location matters too. Institutional Property Advisors notes that outside of big-box deals, demand continues to center on small-bay tenants, particularly around Orlando International Airport.
The last-mile logic is straightforward. Orlando’s population growth, tourism corridor and contractor economy generate constant demand for close-in space with good truck access. Big-box demand concentrates where highways meet, with several 200,000-plus-square-foot leases signed just west of the airport near the convergence of SR 528, Florida’s Turnpike and Orange Blossom Trail.
Industrial Snapshot by Segment
| Segment | Condition | Outlook |
|---|---|---|
| New small-bay | Mid-5% vacancy | Tight |
| Pre-1980 small-bay | Losing tenants | Soft |
| Big-box near MCO | Active leasing | Watch new supply |
| Orlando Central Park | Rising vacancy | Tenant-favorable |
Cap Rates and What They Mean for Leases
Cap rates, the ratio of a property’s net operating income to its price, matter to tenants as much as to investors. When cap rates rise, owners need more income to justify a building’s value, which can mean firmer rents and tougher negotiations.
Orlando’s office investment market is rebounding sharply. Avison Young reports $327 million in office investment volume year to date in 2026, nearly double the full-year totals for both 2024 ($175 million) and 2025 ($152 million), putting 2026 on track for the strongest year since 2021.
Pricing varies widely by asset type. A Q2 2026 Orlando market update from a Berkadia professional put the metro office and medical office market cap rate at 9.1%, with medical office pricing 150 to 200 basis points tighter than traditional office, and traditional office trading above 8%. The same update listed the industrial market cap rate at 6.6%, with cap rates up more than 50 basis points since the 2022 peak.
Industrial values are still rising on a per-square-foot basis. Lee & Associates reports average industrial sales pricing reached $168.97 per square foot in Q2.
What This Means for Your Lease
- Class A office tenants: Owners with strong occupancy and tight cap rates have pricing power. Expect firm rents but negotiate on tenant improvement allowances and free rent.
- Class B office tenants: Older buildings with higher cap rates face pressure to fill space. This is where meaningful concessions live, especially in Lake Nona and parts of Maitland.
- Medical office users: Strong institutional demand from health systems keeps pricing tight. Lock in longer terms if you can.
- Industrial tenants: Newer small-bay remains a landlord’s market. Older and larger buildings in Orlando Central Park and the airport corridor offer more room to negotiate.
The rate environment adds uncertainty. The same Berkadia update noted the Fed had held rates and futures markets were pricing better-than-even odds of a hike before year-end. Higher-for-longer rates keep cap rates elevated and make refinancing harder for owners of older buildings, which can create opportunities for tenants and buyers alike.
Tenant Demand Is Shifting Toward Flexibility
One leading indicator suggests more office demand is coming. TenantBase reports that office accounted for 54.4% of Orlando tenant searches in Q3 2026, nearly three times its 18.9% share in Q2. But tenants want flexibility: 57.4% of Orlando office tenants on the platform sought terms under one year, and 26.5% sought two- to three-year terms.
Short terms reflect smaller businesses and uncertainty about future headcount. They also explain the success of flexible operators like VentureX, which committed to 27,000 square feet in Lake Mary.
Brian’s Take
Orlando’s commercial real estate market rewards specificity. A single metro vacancy number tells you almost nothing. Winter Park at 4% and Lake Nona near 30% are different markets that happen to share a zip code prefix. The office recovery is real but narrow: it’s being carried by quality buildings and a construction pipeline that’s essentially empty. That’s a durable setup for owners of good Class A space through at least 2028, when Westcourt’s trophy tower arrives. The old office stock built before 1990 is a different story, and investors buying it need a repositioning plan, not just a cap rate. On industrial, the headline vacancy hides the fact that newer small-bay space is running tight. Contractors and local distributors looking for modern close-in space should plan renewals early. If I were a tenant today, I’d be negotiating hard in Lake Nona before Siemens moves in, and locking long terms in Downtown before the flight to quality pushes rents further.
Frequently Asked Questions
Is Orlando’s office market recovering?
Yes, gradually. CBRE data shows three consecutive quarters of positive net absorption in 2026 and vacancy declining from a 17.5% peak in late 2025 to 16.6% in Q3 2026.
Which Orlando office submarket is strongest?
Winter Park has the tightest vacancy at about 4%, followed by East Orlando and Downtown. Downtown commands the highest rents and is the main beneficiary of the flight to quality.
Why is Lake Nona office vacancy so high?
Lake Nona has a small office inventory with significant vacant space awaiting occupancy. Siemens Energy’s 242,700-square-foot move-in, expected in Q1 2027, should reduce vacancy substantially.
Is small-bay industrial space hard to find in Orlando?
Newer small-bay space is tight, with vacancy in the mid-5% range. Older pre-1980 small-bay buildings have more availability and more negotiating room.
What are Orlando cap rates in 2026?
Market-wide office cap rates run around 9% with traditional office above 8% and medical office in the roughly 6% to 6.75% range, while industrial averages roughly 6.6%, according to a Q2 2026 Berkadia market update. Individual deals vary widely by building quality.
Is now a good time to lease office space in Orlando?
It depends on submarket and building class. Tenants have strong leverage in Lake Nona and older Class B buildings, but limited leverage in Downtown Class A, Winter Park and East Orlando.
Sources and Further Reading
- “Orlando Office Figures Q3 2026,” CBRE Research, October 7, 2026
- “Orlando Office Figures Q2 2026,” CBRE Research, July 9, 2026
- “Orlando Office Figures Q1 2026,” CBRE Research
- “Orlando Office Figures Q4 2025,” CBRE Research
- “Orlando Industrial Figures Q3 2026,” CBRE Research, October 7, 2026
- “Orlando Industrial Figures Q2 2026,” CBRE Research, July 9, 2026
- Orlando Office MarketBeat Q3 2026, Cushman & Wakefield
- Orlando Industrial MarketBeat Q3 2026, Cushman & Wakefield
- “Orlando Gains Momentum Via Strong Office Leasing, Owner-User Acquisitions,” Avison Young via REBusinessOnline
- “High-End Office Properties Attract Larger Tenants in Orlando,” Avison Young
- Orlando Office Market Report 1Q 2026, Marcus & Millichap
- Orlando Industrial Market Report 2Q 2026, Marcus & Millichap
- Orlando Industrial Midyear 2026 Investment Outlook, Institutional Property Advisors
- Q2 2026 Industrial Market Report, Lee & Associates Central Florida
- Q3 2026 Orlando Commercial Real Estate Market Report, TenantBase
- “Orlando Office Shake-Up as Big Tenants Hog Top Space,” Hoodline, February 20, 2026
