Are there more empty storefronts in downtown Bellingham? Here’s the latest data
Recent changes in the city’s real estate market varied drastically across Bellingham, according to a recent commercial real estate report by Ryan A. Martin, co-owner and broker at Pacific Continental Realty in Bellingham.
“Bellingham’s overall commercial real estate market for retail remained steady in the first quarter of 2026,” the first-quarter 2026 report states. “The vacancy rate increased slightly from 5.7% in the fourth quarter of 2025 to 5.8% in the first quarter. The average asking rents ticked up a bit for the entire city from $20.99 per square foot to $21.10.”
Retail
Retail vacancies and demand varied across the city, with downtown having more vacant storefronts compared to Barkley Village.
“The Barkley Village area is in demand from retailers with a vacancy rate of only 3.1% and an average rent nearing $30 per square foot,” Martin reported. “However, downtown Bellingham saw its retail vacancy rate rise to 12.2% in the first quarter with an average rental rate of $15.42 per square foot, a little more than half as much as charged in Barkley Village.”
Downtown Bellingham and Sunset Square combined make up over half of the almost 600,000 square feet of vacant retail space in Bellingham, each at a 27.9% vacancy rate, according to the report.
Sunset Square last year lost large box stores At Home, JoAnn and Rite Aid, adding significant square footage to its running total of vacant space.
Office space
“Bellingham’s overall office vacancy rate dipped from 4.2% in the fourth quarter to 4.1% in the first quarter. The average asking rate declined again to $18.90, nearly $1 less than in the third quarter of 2025,” according to Martin’s report.
Barkley Village also had the lowest vacancy rates for office space in the city at only 4%. Meanwhile, downtown Bellingham is at 7.7% vacancy, accounting for more than half of the city’s vacant office space.
Industrial real estate
Bellingham’s industrial property remained the most “constrained” according to the report, as vacancy dropped from 1.9% to 1.2%, the lowest rate it’s been since 2023.
“Much of this absorption occurred in the waterfront district, including Pure Blue Tech’s lease of the approximately 42,000-square-foot former Silfab building on Cornwall Avenue,” Martin said.
Looking forward
“Overall, the Bellingham commercial real estate market remains stable, supported by consistent leasing activity, particularly in the industrial sector,” Martin said. “This is despite ongoing uncertainty in the broader economic environment that is impacting investment sales.”
