What if we told you that some of the most desirable real estate locations in the country are currently largely underutilized? These locations could be the key to opening up more opportunities for homebuyers, seniors, and others. What if I told you something? More opportunities means more housing. More housing means more supply. An increase in supply means a decrease in price.
Introducing abandoned office parks nationwide!
Due to COVID-19, many office buildings in downtown areas and prime suburbs have been emptied, and employees continue to choose to work remotely. In fact, at the end of August, office occupancy rates nationwide were just 43%. Wow!
Some prominent companies, such as Apple, require employees to return to the office at least three days a week, while others require employees to be fully remote if they choose. Allowed. The effect is shrinking (or at least hard-looking) office space across the country. please think about it. Why do these companies keep paying for spaces that are underutilized or not used at all? They provide space heating and cooling, cleaning, electricity, technicians, office supplies, machinery, etc. you have to pay to do it. In this post-pandemic new normal we’re in, that may not be necessary.
Now the question arises: what to do with all this space? Many are starting to answer this question in the form of developments that include a combination of housing, entertainment and dining. , seniors centers, or other community spaces. Last year, it is estimated that over 8,000 apartment units were created from former office buildings, and he expects more than 13,000 units to become available this year. Most of these units are in Philadelphia (my hometown). Washington DC; Los Angeles and Cleveland.
Sounds like a great solution. If office space continues to decline, it will likely become a major growth area. Businesses typically lock office leases for 5 to 20 years or more. So companies that signed new leases before the pandemic or recently renewed leases could be locked up for nearly another 20 years.
Another hurdle in trying to convert these types of buildings to housing is that these areas tend to have higher costs, more regulatory barriers, and longer timelines for project completion. . The cost of the conversion, coupled with the zoning changes that would be required, coupled with the challenges of high labor and supply chain issues, we believe will take years to complete. and the wheels of bureaucracy are slow to turn…
But these largely empty office buildings are already equipped with sewers, parking lots, loading docks, etc., so it would be insane not to convert these spaces into living quarters. Another thing to consider is the huge parking lot that is no longer needed as not many workers show up every day.
Perhaps a pool complex? a lot? park?
Hmm… Interesting. It’s starting to sound like a great place to live!
Seth Lejeune is a partner and team leader at REMAX HOMEPOINT in Royersford and can be reached at firstname.lastname@example.org or 610-804-2104.
https://www.dailylocal.com/2022/11/13/asksethanything-could-empty-office-buildings-bring-down-home-prices-column/ Can Empty Office Buildings Lower Home Prices? [Column] – Daily local