St. Louis Office Market Update: Clayton and Suburban Submarkets Lead in 2025
BLOG // September 2025
Heartland Real Estate Business – September 2025
St. Louis Office Market Update: Clayton and Suburban Submarkets Lead in 2025
The St. Louis office market continues to tell two very different stories in 2025. Downtown’s central business district (CBD) is struggling with rising vacancy and negative absorption, while Clayton and several St. Louis County submarkets are experiencing robust activity fueled by steady demand and strong leasing volume.
Clayton’s Strength Continues
Clayton remains the region’s most resilient office submarket. As of Q3 2025, the vacancy rate stood at just 10.7%, despite being the only market with notable new construction since 2020. According to CoStar, Clayton recorded 209,000 square feet of net absorption over the past 12 months.
Headline transactions include:
- Caleres relocation into 156,000 SF at 8235 Forsyth and 8182 Maryland Avenue
- Missouri Athletic Club’s new location, occupying 30,518 SF at Pierre Laclede Center
- Strong absorption at Commerce Bank Tower, Emerson Tower, and continued stability at the Centene Campus
These deals underscore Clayton’s appeal to tenants prioritizing a central location, modern amenities, and quality Class A product.
Suburban Momentum
Clayton isn’t alone in its strength. Suburban markets are also outperforming the metro average:
- Des Peres: Vacancy tightened to 6.3%, with 194,000 SF absorbed in the past 12 months.
- Chesterfield / Highway 40 Corridor: Long known as an oversupplied office market, Chesterfield has rebounded with a 13.1% vacancy rate and 194,000 SF absorbed in the past year.
This suburban performance reflects a clear tenant trend: consolidating into high-quality, amenity-rich offices to support hybrid work models, often at the expense of older downtown and Class B/C suburban properties.
Downtown Challenges
By contrast, downtown St. Louis faces ongoing headwinds. As of Q3 2025, the CBD reported a 19.9% vacancy rate and negative absorption of 243,000 SF.
The distressed sale of Bank of America Plaza illustrates the extent of the challenge. Once appraised at $72.5 million (2015), the 30-story tower sold at auction in mid-2025 for just $6.3 million — a 91% decline in value.
Many downtown tenants are downsizing, relocating to suburban markets, or exiting traditional office space altogether. For landlords, this means increased vacancy, heavier concessions, and in some cases, distress.
Outlook: Quality Wins
Looking ahead, Clayton, Des Peres, Chesterfield, and other strong suburban submarkets are expected to continue outperforming. Downtown’s recovery depends on policy support, capital availability, and creative redevelopment strategies.
The clear takeaway for 2025: tenant demand is strong for the right product. Companies are investing in spaces that bring employees back to the office, emphasizing flexibility, amenities, and central access. For landlords and investors, quality continues to win.
Looking for office space in St. Louis? The NAI DESCO team is here to help you find the right fit.
