Rochester Commercial Office Space for Rent

Q4 2025

Rochester Commercial Real Estate Market Report

Focus: Q4 2025 Market Trends

Executive Summary

The Rochester commercial real estate (CRE) market in late 2025 is defined by strong residential tailwinds and mixed performance across commercial sectors. The Residential market is receiving national attention, with Rochester ranked as a top housing market for 2026 due to its affordability and low inventory [4]. The Multifamily sector is a key beneficiary, leading the nation in rent growth alongside Syracuse, driven by constrained supply [1, 5]. Office fundamentals remain challenged with vacancy hovering around 22%, though a "flight to quality" is supporting Class A assets [2]. Industrial demand has softened slightly with vacancy rising to 6.0%, but the sector remains stable due to the region's manufacturing base [3]. Retail is resilient, with low vacancy and steady rent growth supported by limited new development [1].

TenantBase Proprietary Data [6] highlights the distribution of active tenant demand over the last 90 days:

  • Retail/Storefront dominated market activity with 75.93% of all searches [6].
  • Office was the second most active sector at 12.96% [6].
  • Warehouse accounted for 11.11% of total search volume [6].

Office Market

Market Overview Rochester's office market is in a period of transition, grappling with elevated vacancy while quality space sees steady demand.

  • Vacancy & Absorption: The overall vacancy rate decreased slightly to 22.1% in Q4 2024, down from 22.6% a year prior [2]. However, the CBD vacancy rose to 27.3% due to large blocks of space returning to the market, such as the RG&E building [2].
  • Rental Rates: Average asking rents are stabilizing, with Class A space commanding around $20.50 per SF [2].
  • Market Trends: A "flight to quality" persists, with Class A assets absorbing demand while Class B space faces rising vacancy [2].
  • Tenant Preferences: TenantBase data reflects a tenant base seeking flexibility, with 42.86% of inquiries for Less than one year leases [6].

TenantBase Activity [6]

  • Demand Share: Office accounted for 12.96% of total search volume [6].
  • Lease Term Preference: Demand is varied but leans short-term:
    • Less than one year: 42.86% of deals [6].
    • 2-3 Years: 28.57% of deals [6].
    • 1-2 Years: 14.29% of deals [6].
  • Size Requirements: The average size requirement for short-term office leases is relatively small at 500–1,000 SF [6].

Industrial & Warehouse Market

Market Overview The industrial sector remains a stable pillar of the Rochester economy, despite a recent uptick in vacancy due to new supply and slower leasing velocity.

  • Vacancy & Rent: The vacancy rate stood at 6.0% in Q2 2025, with asking rents averaging $6.82 per SF [3]. This represents a slight softening but remains healthy compared to historical averages.
  • Demand Drivers: The market is supported by the region's strength in advanced manufacturing and food production, with major investments from companies like Fairlife and Chobani boosting long-term prospects [3].
  • Leasing Trends: TenantBase data indicates a specific demand for mid-term leases in the warehouse sector.

TenantBase Activity [6]

  • Demand Share: Warehouse accounted for 11.11% of total search volume [6].
  • Lease Term Preference: All recorded warehouse inquiries with a specified term sought 3-5 Year leases [6].
  • Size Requirements: The average lower size requirement for these 3-5 year leases was 2,500 SF [6].

Retail Market

Market Overview Rochester's retail sector is performing well, characterized by low vacancy and positive rent growth as limited new construction keeps the market tight.

  • Performance: Nationally, retail has maintained the lowest vacancy rate among major property types, a trend mirrored in Rochester where limited availability is driving competition [1].
  • Rental Rates: Rent growth remains positive, supported by the scarcity of quality space and steady consumer spending [1].
  • Tenant Interest: Retail dominated search activity in Q4, accounting for over three-quarters of all inquiries, signaling a vibrant small business environment [6].

TenantBase Activity [6]

  • Demand Share: Retail/Storefront activity dominated with 75.93% of all search volume [6].
  • Lease Term Preference: Retail tenants show a strong preference for mid-to-long-term stability:
    • 3-5 Years: 39.13% of deals [6].
    • Less than one year: 17.39% of deals [6].
    • 2-3 Years: 17.39% of deals [6].
  • Top Locations: Tenant interest is highest in Rochester (City) (11 deals), followed by Brighton/Henrietta and East Rochester [6].

Multifamily Market

Market Overview The multifamily market is a standout performer, with Rochester ranking among the top markets in the nation for rent growth due to a lack of housing supply.

  • Rent Growth: Rochester and Syracuse are leading the nation in rent growth forecasts for 2025, driven by low vacancy and rising home prices that keep residents in the rental pool [1, 5].
  • Affordability: Despite increases, rents remain relatively affordable compared to national averages, with the median asking rent around $1,339 [5].
  • Demand: Strong demand is fueled by the region's stability and the high cost of homeownership, which has created a "lock-in" effect for renters [4, 5].

2026 Outlook

Looking ahead to 2026, the Rochester market is positioned for significant attention and growth.

  • Housing Boom: Rochester is forecasted to be the #2 housing market in the U.S. for 2026, with expected price growth of over 10% as buyers seek affordability [4].
  • Multifamily Strength: The tight housing market will continue to funnel demand into the multifamily sector, supporting high occupancy and continued rent appreciation [1, 5].
  • Industrial Stability: Continued investment in the region's manufacturing and food processing capabilities will provide a stable foundation for industrial demand [3].

Sources

  1. National Association of Realtors: March 2025 Commercial Real Estate Market Insights
  2. Pyramid Brokerage Company: Rochester Office MarketBeat Q4 2024
  3. Cushman & Wakefield: Rochester Industrial MarketBeat Q2 2025
  4. Norada Real Estate Investments: Top 10 Housing Markets for 2026
  5. Chandan Economics: Multifamily Rent Growth Update November 2025
  6. TenantBase Proprietary Market Data (Rochester - Last 90 Days)

Information in this report is aggregated from various third-party sources and synthesized using artificial intelligence and other research tools. While we believe these sources to be reliable, we cannot guarantee the absolute accuracy or completeness of the data. This report is intended for informational purposes to provide market insight and should be independently verified prior to any use in a real estate transaction or legal commitment.