With work-from-home firmly established, many real estate analysts predict a dramatic reduction in office space leasing and plummeting property values.
But the high-end of the office segment might actually be headed for a shortage, according to real estate intelligence company CoStar Group. This counterintuitive trend is due to a drastic drop in construction of elite Class A properties.
Despite the overall drop in occupied office space, buildings aged 0-3 years are doing well. They have attracted an average of 12.7 million sf per quarter since the beginning of 2020. By comparison, the quarterly average from 2011-2019 for similar properties was 11.7 million sf.
Office construction has slowed dramatically this year. Less than 30 million sf has broken ground in 2023, making it the lowest year for construction starts since 2011. If this trend continues, the type of space most in demand—newly constructed units—will have the shortest supply.
Related Stories
Coronavirus | Jun 12, 2020
BD+C launches 'The Weekly,' a streaming program for the design and construction industry
The first episode, now available on demand, features experts from Robins & Morton, Gensler, and FMI on the current state of the AEC market.
Office Buildings | Jun 1, 2020
Luxembourg office complex breaks ground in Belval
Foster + Partners designed the building.
Office Buildings | May 27, 2020
512 West 22nd Street: Biophilic design on the High Line
COOKFOX Architects designed the project.
Coronavirus | May 18, 2020
Infection control in office buildings: Preparing for re-occupancy amid the coronavirus
Making workplaces safer will require behavioral resolve nudged by design.
Office Buildings | May 15, 2020
KPF designs three-building San Jose office campus
The project will be adjacent to Google's planned eight million square foot transit village and Diridon Station.
Office Buildings | May 8, 2020
The pillars of work
The workplace will most certainly look different in the future, but how different it looks will be unique to every organization. There (still) is no one-size-fits-all solution.
Office Buildings | Mar 24, 2020
Morphosis designs lululemon’s new global headquarters
The HQ’s design is meant to serve as an extension of lululemon’s core values.
Office Buildings | Mar 16, 2020
Investments in ‘human experiences’ are paying off for employers
A recent survey conducted by JLL and Harvard Business Review found that more companies are giving their employees greater say in changing their work environments.
Coronavirus | Mar 15, 2020
Designing office building lobbies to respond to the coronavirus
Touch-free design solutions and air purifiers can enhance workplace wellness.
Plumbing | Mar 13, 2020
Pioneer Industries launches new website
Pioneer Industries launches new website
