As the Indianapolis metro celebrates another office vacancy win, progress downtown is trending in the opposite direction.
Why it matters: The vacancy rates are a sign that conditions post-COVID haven’t returned to “normal” in the heart of the city.
- Meanwhile, an uptick in mixed-use developments and office-to-apartment conversions suggests that downtown’s new normal is something that embraces play the way it once embraced work.
State of play: Downtown office vacancy rates as tracked by the Downtown Indy Alliance in its annual community report have climbed steadily since the pandemic, going from 7.8% in 2020 to 12.1% in 2025.
- The jump from 11.2% in 2024 to the current rate is the second-largest annual increase of the last five years. The biggest was when it went from 8.6% to 9.7% between 2021 and 2022.
What they’re saying: “Though vacancies have risen from 7.8% in 2020, the trend mirrors national shifts. Ongoing investments in office, residential, retail and cultural spaces are necessary to keep downtown vibrant and positioned for long-term, sustainable growth,” the Downtown Indy Alliance report states.
- “With a 12.1% vacancy rate — lower than peer cities like Columbus and Charlotte — and competitive rents averaging $23.51 per square foot, the city remains an affordable and attractive market.”
Yes, but: It’s a different story for the Indianapolis metropolitan area, which includes the fast-growing suburbs…