Always a reliable segment of the business, new office construction projects are increasingly being held off or delayed as a result of the pandemic economy.
According to the publication Data Digest, which is published by the Associated General Contractors of America, the “demand for office construction is likely to shrink as layoffs increase and employees are allowed to work remotely for longer.”
To date, only around 25 % of staffers have returned to their former offices nationally, a figure dropping to 10% for parts of New York, but somewhat higher in Los Angeles at 32% and Dallas at 40%.
Last year more than 110 million square feet of new office space was built nationally. That number has decreased by more than 10% this year, say experts, at the same time that overall office leasing numbers continue a downward trend.
According to the Chicago-based real estate company Jones Lang LaSalle, leasing volume nationally was off by a significant 43% as of early this summer, with 29.8 million square feet of office space leased, down from 65.9 million square feet during the same time period last year.
Many of the country’s largest corporations have additionally announced that they most likely won’t be fully re-opening their offices until next summer.
But a trend moving in the opposite direction, according to the Harvard Business Review, is likely to make itself known in the number of “younger workers at the earliest stages of their careers,” still moving to cities in the years to come, desiring jobs that are office-based.
Such countervailing patterns are seen in the recent decision on the part of Facebook to lease out 730,000 square feet of office space in New York.
By Garry Boulard
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