Downtown Baltimore’s multifamily market continues to find its footing in 2025, showing clear signs of improvement after several years of supply expansion and elevated vacancy. The submarket’s fundamentals have strengthened notably, with vacancies declining by more than 200 basis points since the start of the year, and more than 550 basis points since its post-pandemic peak in 2023. The absence of new deliveries has played a significant role, as no units have come online in 2025 following the roughly 1,000 apartments completed across 2023 and 2024, all of which have since stabilized. Leasing activity has accelerated, supported by steady demand from the city’s healthcare, education, and government employment base, sectors that anchor Downtown’s renter population.
Source: CoStar, HSA Research
Development Activity and Supply Conditions
Although Downtown has remained an active development hub, its pace of growth has been far more measured than many of its waterfront counterparts. Since 2023, the submarket’s apartment inventory has increased by about 10%, a restrained expansion compared to the rapid growth seen in adjacent areas. Fells Point and Canton, for example, have registered inventory increases of 57% and 27%, respectively. This more controlled level of construction has allowed Downtown’s existing stock to gradually absorb, pushing vacancy lower and helping stabilize rents heading into the new year.
Roughly 700 units remain under construction in the city’s urban core, led by key projects such as 222 St. Paul Place and 210 N. Charles Street. One of the most notable trends reshaping Downtown is the conversion of former hotels and offices into multifamily housing. These adaptive reuse projects have redefined the city’s skyline while breathing new life into long-vacant or distressed assets. With ground-up construction costs remaining elevated, conversions have emerged as a cost-effective and environmentally sustainable way to expand the housing stock.
Among these projects, Redwood Place stands out as a hallmark of Downtown’s ongoing transformation. The building has undergone two significant conversions in less than a decade, originally constructed as an office building before being redeveloped into a hotel in 2015. In 2024, the property’s current ownership completed an extensive renovation, converting the hotel into modern apartments that preserve its architectural character while catering to today’s urban renter.
A Strengthening Outlook
As vacancy continues to decline and leasing momentum accelerates, Downtown Baltimore enters the final month of 2025 on considerably stronger footing. Stabilized deliveries, a disciplined pipeline, and a growing wave of adaptive reuse projects have collectively positioned the submarket for continued improvement. While broader economic conditions will influence performance, Downtown’s current trajectory points toward a market steadily regaining balance.