New Hampshire office vacancy rate drops to 10.3% as rents climb

The supply of office space in New Hampshire is shrinking, and the cost to lease that remaining space is rising.

A third-quarter market analysis by Colliers shows the statewide office vacancy rate fell to 10.3%. That figure represents a 3.1 percentage point decrease from the same period last year. At the same time, average asking rent increased by 1.7% year over year to reach $22.28 per square foot.

Kristie Russell, the research director at Colliers, attributed the market shift to two primary forces: workforce habits and a stalled construction pipeline. Since the pandemic, many companies adopted hybrid schedules. Some have since reversed course. Fidelity, for example, moved most of its New Hampshire employees to full-time on-site work in September. Other firms have retained hybrid models, which often leads to downsized office footprints.

Russell noted that New Hampshire ranks fourth in the nation for the share of hybrid job postings. Data from Robert Half, a staffing services firm, showed that 19% of job postings in the state were for hybrid roles in the first quarter of 2026. That placed New Hampshire tied with Washington, behind Minnesota, Massachusetts, and New York.

On the construction side, Russell described the pipeline as limited. Several office projects that broke ground are currently on hold. Some structures have frames in place but lack further progress while developers wait for committed tenants. Conversions of office space to other uses are paused rather than canceled.

“The couple of office projects that broke ground have been on hold, with frames up but no further progress while they wait for tenants,” Russell said. “There are no major projects underway, but some owners may continue to shift office space to other uses as leases expire, and a few buildings for sale could become conversion candidates.”

One major conversion is already underway in Dover. Brady Sullivan Properties, a Manchester-based developer, is transforming the former Liberty Mutual campus. The 585,000-square-foot site is being redeveloped into a mixed-use lifestyle village called The Village at River’s Edge. The project will include commercial, retail, and residential components.

Colliers also reported that the commercial industrial and warehouse market remains stable. The statewide vacancy rate for that sector held steady at 5.8%. Average rents in the industrial sector rose 4.4% year over year to $11.79 triple net. That represents a 42.7% increase over the past five years.

Russell explained that smaller industrial spaces are leasing quickly, while larger blocks are taking longer to fill. The largest recent transaction in that sector was the $47.5 million sale of the former Anheuser-Busch plant in Merrimack to United Therapeutics.

WalletHub data places New Hampshire as the fifth-best state in the country for jobs. The ranking is based on several criteria, including job opportunities, employment growth, unemployment rate, median annual income, and average work week length. New Hampshire currently has an unemployment rate of 2.6% and a median annual income of $112,100.