Tenants flock to Class A office in Raleigh’s North Hills; other submarkets lag behind
AI-generated summary reviewed by our newsroom.
- One North Hills Tower reached full occupancy after two years and major leases.
- Amenity-rich North Hills and downtown drive lease demand amid weak suburbs.
- Vacancy edged down to about 20.9%, though absorption remains negative.
In late 2023, Kane Realty’s “trophy-class” One North Hill Tower opened with much fanfare, part of the firm’s long-awaited North Hill’s Main District mixed-used expansion.
Today, despite strong headwinds, the 10-story, 266,000-square-foot Class A office building at 4000 Center is at full occupancy, spokesperson Hannah Smith confirmed on Thursday.
Most recently, it capped out with two major tenants.
Private jet operator flyExclusive signed a lease for an entire floor totaling close to 24,000 square feet of office space at 4000 Center at North Hills Street in Midtown Raleigh, while professional services firm RSM US LLP claimed another floor with almost 18,000 square feet of space, the Raleigh-based firm announced on Jan. 6.
Among other high-profile tenants: Parexel, Weatherby Healthcare, JT International, Raymond James & Associates, PwC, and Ralliant.
In this post-pandemic era of hybrid work and high interest rates, demand for the district’s “live-work-play” design — combining office, residential, retail — remains strong, said Mike Smith, Kane Realty’s CEO.
“North Hills continues to be a place where businesses flourish,” he said.
Triangle’s office market ‘comeback’?
After years of record high vacancies and companies downsizing, the newly inked deals show signs that the Triangle commercial real estate market is finally on a comeback, experts say.
Even as absorption remains negative and older suburban buildings struggle, demand is rebounding in select “amenity-rich” submarkets, like North Hills and downtown Raleigh.
In Raleigh-Durham, overall vacancy peaked at 21.31% in the second quarter of 2025, breaking records set in 1986 and 1991.
But it has since dropped to 20.6%, according to CBRE’s 2025 fourth-quarter market report.
More than 80 leases were signed in the last two quarters, with West Raleigh, Glenwood/Creedmoor, and the RTP/1-40 Corridor submarkets recording the highest concentration of lease signings, the report said. Of these, 75% were new leases, indicating “expansion within the market.”
Downtown Raleigh is also seeing an uptick.
In just five years, 898,412 square feet of new office space has been added downtown, bringing the total inventory to 6,424,512 square feet, according to Downtown Raleigh Alliance’s 2025 third-quarter market report.
Net lease absorption stood at 43,785 square feet, bringing the year-to-date total to 132,659 square feet. Class A occupancy rate hovered at 86.3%.
“The leasing market is booming,” said Bill King, DRA’s president, told The N&O, adding that occupancy is higher than primary market competitors Charlotte, Nashville and Austin.
But other pockets, with aging inventory and limited walkability, are still struggling.
The prominent office tower with the IQVIA signage in Durham, just off Interstate 40 at 4820 Emperor Blvd., has been empty since early 2023. Citrix’s former headquarters at the intersection of West and Hargett streets in Raleigh’s Warehouse District has also sat mostly vacant for years.
Distressed sales are also popping up.
Last December, a Raleigh office building 2610 Wycliff Road between Rex Hospital and the Beltline, sold in foreclosure for $16 million to RGA Reinsurance Company, Triangle Business Journal reported. The 174,014-square-foot building is assessed at $30.8 million.
Meanwhile, the construction pipeline remains empty. No new office space is currently underway.
CBRE predicts improving capital markets sentiment will support new development by late 2026 or early 2027.
This story was originally published January 19, 2026 at 5:30 AM.
