A continued flight to quality punctuated the Des Moines office market during the first quarter of 2026 with the trend forecast to continue, according to market reports from area brokerage firms.

Leasing also got off to a hot start in 2026, in part of because of competitive lease rates, the reports showed.

The Business Record reviewed first-quarter office market reports from JLL, CBRE, Colliers and Cushman & Wakefield.

JLL’s report showed the first quarter was the fifth consecutive quarter of positive net absorption, citing the city of Des Moines’ move into the former Nationwide building as an example of the vibrant activity in the Central Business District.

The JLL report also acknowledged plans for a new seven-story mixed-use development in the Market District that will feature a boutique hotel, condominiums and a parking ramp.

The brokerage firm also cited “the distinct flight to quality.”

“As companies adapt their workplace strategies, they are prioritizing modern, well-amenitized offices to attract and retain employees,” the report said. “This has created a divided market with differing performance between property classes. The scarcity of available Class A space, combined with a lack of new construction, has led to discussions about the potential for a new speculative Class A office project.”

The JLL report also discussed West Des Moines’ plans to transform the Westown Parkway-University Avenue corridors, R&R Realty’s upgrades at the Three Fountains Office Park and the proposed redevelopment of the Valley West Mall property as things to watch in the coming months.

In its report, CBRE said new office construction remains “conservative.”

“No new competitive office properties have been delivered in the Des Moines market since Q2 2024,” CBRE’s report said.

That has contributed to a decrease in the office market vacancy over the past several quarters, CBRE said.

The firm cited the American Equity Investment Life Insurance Company’s move into 1150 Locust St., as an example of growing activity in the Central Business District. 

American Equity’s former building at 6000 Westtown Parkway, which was sold to Telligen, which will occupy that building.

Colliers said leasing activity was strongest downtown in the first quarter as tenants gravitated to “newer and repositioned buildings offering superior amenities, connectivity and modern design.

“Tenant demand in Des Moines is increasingly driven by space upgrades, and in some cases, expansion, particularly among insurance, financial and professional service firms,” Colliers said in its report.

In its report, Cushman & Wakefield said leasing activity got off to a hot start in the first quarter of 2026.

“[The quarter] was the most active period for U.S office leasing since before the pandemic,” the report said.

The pace may be difficult to sustain, however, with tepid job growth and “the waning momentum of the return-to-office movement.”

Cushman & Wakefield also cites rising energy costs as a potential challenge for the remainder of 2026.

Despite robust leasing activity, tenants still have the upper hand as a result of favorable lease rates, the brokerage firm said.

Here are highlights from each brokerage firm’s report:

JLL

• Total vacancy 15.9%
• YTD net absorption 103,732 square feet
• Overall direct asking rent $21.90 per square foot
• Under development 89,077  square feet
• Preleased 79.9%

CBRE

• Total vacancy 13.9%
• YTD net absorption 346,892 square feet
• New construction delivered 0 square feet
• Under construction 71,000 square feet
• Lease rate $20,52 per square foot

Colliers

• Total vacancy 16.1%
• YTD net absorption 38,000 square feet.
• Under construction 0 square feet
• Class A lease rate $21.12 per square foot

Cushman & Wakefield

• Total vacancy 14.4%
• YTD net absorption 196,000 square feet
• Asking rent $20.65 per square foot