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Many articles have been written about the death of the office building in recent years. This week, Carl Gomez, chief economist and head of analytics at Costar, a commercial real estate data company, discusses the past, present and future of the office at Down to Business.
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Contrary to popular belief, office occupancy — a measure of the number of people per square foot of office space — had been declining in North America in the decade before the pandemic struck. As such, the pandemic hasn’t resulted in empty offices, although it has accelerated that process, Gomez said.
In a report on the subject, he calculated that office occupancy fell by about 1.4 percent per year between 2009 and 2019, but that decline has worsened to 7.5 percent per year since 2020.
The question is what happens next? Gomez said many employees prefer remote work because it saves time on the commute and might be just as productive at home, but management often prefers to see people in the office. The extent to which remote working becomes a permanent trend may ultimately depend on whether there is a recession and what happens in the labor market.
Gomez talks about a variety of other factors at play in this special double episode about the future of the office tower.
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If you have any questions about the show or would like to raise any issues, email us at: [email protected].
• Email: [email protected] | Twitter: Gabe Friedz
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