The novel coronavirus may do to U.S. office rentals what e-commerce did to malls, or so goes a line of thinking running through commercial real estate circles.
FILE PHOTO: The buildings of Hudson Yards rise above lower Manhattan as seen from an apartment in the Central Park Tower building as the building celebrates its topping out in New York, U.S. September 17, 2019. REUTERS/Lucas Jackson
Now technology threatens to further reduce the amount of square footage companies lease after seeing how well the work-from-home experience has fared. In Manhattan, whose skyscrapers have long been the most valuable U.S. property class, further downsizing could pressure leasing prices that soared to record highs during the good times but now may slip as they typically do in a recession.
The age of buildings is another important factor that could hinder investment returns. Landlords have poured hundreds of millions of dollars into rejuvenating Manhattan skyscrapers built as recently as the late 1990s. Such spending has been seen in many U.S. cities to protect an asset values. Office space in the tony Far West Side, Plaza District and Park Avenue, where many hedge funds reside, costs more than $100 a square foot, while older buildings just south of Times Square, and swaths of downtown, rent for half that rate.Utilization studies show that often just 40% to 60% of workspace is occupied, which has led some companies to sublease extra space or turn it into collaborative areas, said Steven South, design director at architectural firm Spectorgroup in New York.
Scott Nelson, chief executive of occupier services at Atlanta-based brokerage Colliers International, said that while office space demand overall will slacken as companies accommodate a workforce that chooses to work from home, some will rent the same amount of space, but design it less densely for fewer workers to maintain social distancing.
Brasil Últimas Notícias, Brasil Manchetes
Similar News:Você também pode ler notícias semelhantes a esta que coletamos de outras fontes de notícias.
DMV extends expiring driver's licenses due to coronavirus closuresCoronavirus: DMV extends expiring driver's licenses due to office closures
Consulte Mais informação »
U.S. coronavirus deaths set single-day record increase: Reuters tallyU.S. coronavirus deaths rose by at least 2,228 on Tuesday, a single-day record, to top 28,300, according to a Reuters tally, as officials debated how to reopen the economy without reigniting the outbreak.
Consulte Mais informação »
All L.A. residents with symptoms can now get same-day or next-day coronavirus testsCoronavirus: All L.A. residents showing symptoms can now get coronavirus tests
Consulte Mais informação »
G-7 leaders chide Trump over WHO funding stopSeveral world leaders have rebuked Donald Trump for his decision to stop funding the World Health Organization, telling the president that multilateral cooperation is essential to fight the coronavirus pandemic
Consulte Mais informação »