The office space market is facing a new reality in 2024: lower demand and a need for adaptation. While new construction shrunk by 28% compared to last year with 97 million square feet currently under development nationwide, there’s an interesting twist: Cities are responding by converting unused offices into other uses, such as housing.
As we start a new year, the office outlook is still mixed. Although more companies are requiring employees to be in the office some days per week, we are far from the high occupancy that many central business districts enjoyed before 2020. Companies are still figuring out their workplace strategies – how often to bring in employees and how to better use their space for the reality of work today.
As the office sector undergoes transformations in response to evolving work trends and the flight-to quality movement, businesses continue to seek the best office spaces that can suit both their needs and their budgets. For most, the perfect choice may lie in a compromise between location clout and asset quality.
Major themes dominating the attention of commercial real estate development professionals in 2023 included capital markets, financing and industry outlooks, according to the most-read Market Share posts this year. While concerns about usage of office space persist, blog readers were also drawn to posts about industrial real estate – again, often where industrial real estate intersected with capital markets. Read on for the top 10 and catch up on any pieces you missed.
This year has continued to be one of recalibration and reevaluation for office space usage across the U.S. What does the data show about office usage now and what’s ahead? In a recent NAIOP webinar, the authors of the recent office space demand forecast published by the NAIOP Research Foundation explained their research findings.
Adaptive reuse architecture presents a creative and specialized challenge. Understanding basic concepts of conversions is critically important for development professionals, city officials and local communities. Each potential property needs to be evaluated on its own merits to determine the probability of success, and whether the location, costs, timing and existing building layout make sense for a conversion.
Low occupancy across the office sector as well as high demand for housing has many real estate development professionals asking whether adaptive reuse of commercial buildings may be an option to add supply during the housing crisis.
The office market is still struggling with high interest rates and increased levels of remote work, producing a tough lending environment and frozen deals on the sales side, and generous concessions and terms that favor tenants in leasing. That said, there are glimmers of hope.
As investors and occupiers look to improve the sustainability of their investments and operations, decarbonizing the built environment is an increasingly important real estate decision. In a panel at CRE.Converge, sustainable building professionals explored some of the strategies their firms are using to mitigate carbon emissions across their industrial real estate portfolios.
Experts at CRE.Converge discussed the current landscape of commercial real estate loans throughout different sectors, such as multifamily, retail, and office spaces.
