According to a Green Street analyst, average office occupancy may never bounce back to pre-pandemic levels.
Senior Analyst Daniel Ismail said that although his estimation is a “bit tongue-in-cheek,” remote work has been driving demand down. In fact, Green Street anticipates that there will be a 15% decrease in office space demand.
In the meantime, supply has continued to grow at around 1% annually. Ismail states that unless existing office space gets converted or demolished, there is likely to be increased vacancies in the U.S.
Green Street also predicts that the office market will continue to be weak for the time being, despite the uptick in performance from Class A and Sunbelt assets.