NYC office value would drop 44% below pre-pandemic numbers by 2029 due to remote work
Per NYP
New York City office space has recently suffered due to remote work, with very few people returning to the office. A combined 2022 study by researchers from New York University and Columbia University found that its office value could drop by 44% below pre-pandemic numbers.
This came as an update from the 2022 study, which increased its estimations regarding how much office stock would lose. Initially, it was believed that office value would only drop from its pre-pandemic levels by 28% in 2029, but now, the number has increased to 44%.
In a statement to the Real Deal, Arpit Gupta, the co-author of the Work From Home and the Office Real Estate Apocalypse study, it was revealed how they increased their estimates amid the work-from-home environment.
Gupta: “We now estimate a more persistent work-from-home regime, which has more of an impairment of office values even in the long run,”
The study highlighted how not just New York City was affected by the shift to remote work. It was noted that there was a $506.3 billion estimated loss in value nationwide.
Jose Maria Barrero, a Mexico Instituto Tecnologico Autonomo professor, gave a statement regarding how the decision of most workers affected tax revenue.
Barrero: “Less spending by workers in the central areas means a lot less sales tax revenue... If you have fewer commuters, that means less revenue.”
At the end of February, it was noted that an office landlord that was tied to money manager Pimco defaulted on $1.7 billion worth of mortgage notes.
The builders were reportedly owned by Columbia Property Trust and were located in San Francisco, New York, Boston, and Jersey City, New Jersey.
Recently, Nordstrom said that it planned to close over 350,000 square feet worth of commitments in San Francisco. This included 312,000 square feet and 45,496 square feet combined.
See flow at unusualwhales.com/flow.
Other News:
- An office landlord tied to money manager Pimco has defaulted on $1.7 billion of mortgage notes
- Nordstrom to close 350,000 square feet worth of commitments in San Francisco
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