If you’re invested in Office Space REITs you might want to take heed:
Barron’s headline: The Boss May Not Like It. But Millions of Workers Aren’t Coming Back to the Office.
By Evie Liu
Sept. 3, 2022 7:00 am ET
Across the top 10 cities in the nation, the occupancy rate of office buildings was only 43% recently, according to security firm Kastle Systems that tracks card swipes as a barometer. Before the pandemic, the rate was 99%.
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As their previous leases expired during the pandemic, many companies negotiated short-term extensions of only a year or two due to high levels of business uncertainties, says JLL’s Homa. Before the pandemic, the typical renewal term was between five to 10 years.
This means there is a high volume of office space set to expire in 2022 and 2023—about 28% above the trailing three-year average before the pandemic.