The numbers tell the tale: Milwaukee’s office sector is still struggling long after the COVID pandemic. However, there is hope that this sector will stabilize in 2026.
In its fourth quarter Milwaukee office report, Newmark said that the market’s office vacancy rate ended 2025 relatively flat at 21.2%. And while demand for new office space in the Milwaukee area remains muted, the lack of new construction in this sector should help the local office market stabilize this year, Newmark reported.
Newmark also pointed to the removal of some older office product for conversions to multifamily use as another factor that should help keep vacancy rates stable or maybe cause them to dip slightly in 2026. Conversions, though, can be challenging: It’s difficult to find the right office property at the right price and location to make a residential conversion work.
The Milwaukee office sector saw 32,768 negative square feet of absorption in the fourth quarter, according to Newmark, another sign that this asset class continues to struggle as companies seek less square footage when leasing office space.
A bit of good news? Newmark reported that the overall availability rate in the Milwaukee office market dipped 20 basis points to 25.1%. That’s the lowest this rate has been since the third quarter of 2019, which Newmark said signals a modest improvement in the overall balance of the market.
Fourth-quarter leasing activity was sluggish, reaching 297,384 square feet. That brought the total office leasing activity in the Milwaukee market to 1.35 million square feet in 2025, about 15% below the long-term average.
As in most markets, Class-A office properties are faring better when it comes to leasing activity. Newmark reported that Class-A properties accounted for 43% of office leasing activity in the Milwaukee market during the fourth quarter of last year. Downtown Milwaukee captured 29.6% of leasing activity, while suburban submarkets such as Brookfield and the Mayfair/Wauwatosa area are capturing a growing share of tenant demand.
In the largest lease in the Milwaukee office market in the fourth quarter, Ideal Partners signed for 48,384 square feet at 501 W. Northshore Drive in Glendale.
