More office space is set to be removed than added this year, shrinking the overall office footprint.

Office vacancies soared to a record high and still hover right around there at 19%.

Developers also have another 85 million square feet of office space being readied for conversion in the next few years.

After several years of deep distress, the beleaguered U.S. office market has reached an inflection point. This year, office conversions and demolitions will exceed new construction for the first time in at least 25 years.

Simply put, more office space is being removed than added, shrinking the overall office footprint, according to exclusive new data from CBRE Group. The commercial real estate services firm has been tracking this since 2018, but estimates it may be the first time such a dynamic has played out this century, and likely longer.

CBRE found that across the largest 58 U.S. markets, 23.3 million square feet of space is slated for demolition or conversion to other uses by the end of this year. In comparison, developers are projected to complete construction of 12.7 million square feet of office space in those same markets.

"This net reduction – albeit slight – of office space across major markets likely will contribute to lowering the vacancy rate in the quarters ahead, which would benefit building owners," said Mike Watts, CBRE Americas president of investor leasing.