Dr. Gleb Tsipursky – The Office Whisperer
Nirit Cohen – WorkFutures
Angela Howard – Culture Expert
Drew Jones – Design & Innovation
Jonathan Price – CRE & Flex Expert
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A working paper from NYU and Columbia University researchers shows that the value of New York City’s office buildings fell by one-third during 2020.
Now, a new report shows that current trends towards remote and hybrid working could lead to offices losing $500 billion from pre-pandemic values by 2029.
“Imagine thinking about a path where the world remains in this predominantly hybrid or remote work environment that we’re currently in for the next 10 years,” said Stijn Van Nieuwerburgh, a finance and real estate professor at Columbia University’s Graduate School of Business and one of the researchers. “Then the decline is larger—it’s 38% instead of 28%.”
Using data from commercial real estate database CompStak, Van Nieuwerburgh and the other researchers were able to determine that lease revenues fell 8% from January 2020 to December 2021. This decline mainly came from organizations that did not renew or reduce their leases.
“I like to think of this as a train wreck in slow motion, where essentially, only a third of the leases have even come up for renewal,” said Van Nieuwerburgh. “There’s kind of still a lot of decisions about space to be made in the next several years as these leases roll off.”
