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12-12-2022, 11:01 AM
Emil Skandul
Dec 6, 2022, 8:03 PM
Deserted downtowns have been haunting US cities since the beginning of the pandemic.
Before the pandemic, 95% of offices were occupied. Today that number is closer to 47%. Employees' not returning to downtown offices has had a domino effect: Less foot traffic, less public-transit use, and more shuttered businesses have caused many downtowns to feel more like ghost towns. Even 2 1/2 years later, most city downtowns aren't back to where they were prepandemic.
......
the impact on cities' bottom lines has been devastating; in New York, for instance, the value of commercial real estate declined by 45% in 2020, and research suggests it will remain 39% below prepandemic levels.
Less economic activity in urban cores and a lower tax base could mean fewer jobs and reduced government services, perpetuating a vicious cycle that further reduces foot traffic in downtowns, leading to more decline, more crime, and a lower quality of life.
......
The devastation of downtown commercial districts has been an unmistakable shift in America's largest cities. In San Francisco, the landmark Salesforce tower and other buildings have remained mostly unoccupied as the tech industry has embraced remote and hybrid work. In New York, Meta recently terminated its lease agreement for three offices totaling 450,000 square feet in Hudson Yards and on Park Avenue, taking a significant financial hit. This tracks with trends: San Francisco has faced office-vacancy rates of 34% to 40% in some parts of the city, while in New York about 50% of workers are back in the office.
Even in cities where more workers have returned, like Austin or Dallas, occupancy rates are still only 60% of what they were prepandemic. These shifts follow the unassailable stickiness of remote work; researchers for the National Bureau of Economic Research predicted that 30% of workdays would be worked from home by the end of this year, a huge jump from before the pandemic.
......
It estimated that US$453 billion in real-estate value would be lost across US cities, with a 17-percentage-point decline in lease revenue from January 2020 to May 2022. The shock to real-estate valuations has been sharp: One building in San Francisco's Mission District that sold for US$397 million in 2019 is on the market for about US$155 million, a 60% decline.
Much better to read full article at: https://www.businessinsider.com/remote-w...se-2022-12
Dec 6, 2022, 8:03 PM
Deserted downtowns have been haunting US cities since the beginning of the pandemic.
Before the pandemic, 95% of offices were occupied. Today that number is closer to 47%. Employees' not returning to downtown offices has had a domino effect: Less foot traffic, less public-transit use, and more shuttered businesses have caused many downtowns to feel more like ghost towns. Even 2 1/2 years later, most city downtowns aren't back to where they were prepandemic.
......
the impact on cities' bottom lines has been devastating; in New York, for instance, the value of commercial real estate declined by 45% in 2020, and research suggests it will remain 39% below prepandemic levels.
Less economic activity in urban cores and a lower tax base could mean fewer jobs and reduced government services, perpetuating a vicious cycle that further reduces foot traffic in downtowns, leading to more decline, more crime, and a lower quality of life.
......
The devastation of downtown commercial districts has been an unmistakable shift in America's largest cities. In San Francisco, the landmark Salesforce tower and other buildings have remained mostly unoccupied as the tech industry has embraced remote and hybrid work. In New York, Meta recently terminated its lease agreement for three offices totaling 450,000 square feet in Hudson Yards and on Park Avenue, taking a significant financial hit. This tracks with trends: San Francisco has faced office-vacancy rates of 34% to 40% in some parts of the city, while in New York about 50% of workers are back in the office.
Even in cities where more workers have returned, like Austin or Dallas, occupancy rates are still only 60% of what they were prepandemic. These shifts follow the unassailable stickiness of remote work; researchers for the National Bureau of Economic Research predicted that 30% of workdays would be worked from home by the end of this year, a huge jump from before the pandemic.
......
It estimated that US$453 billion in real-estate value would be lost across US cities, with a 17-percentage-point decline in lease revenue from January 2020 to May 2022. The shock to real-estate valuations has been sharp: One building in San Francisco's Mission District that sold for US$397 million in 2019 is on the market for about US$155 million, a 60% decline.
Much better to read full article at: https://www.businessinsider.com/remote-w...se-2022-12
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