By Sarah Lynch, Inc. (TNS)
The office is getting emptier—and will soon reflect the new world of work.
Twenty-four percent of U.S. office space will be vacant by early 2026, according to a new report from Moody’s and first reported by Bloomberg. That’s up from the 19.8 percent vacancy rates reported in the year’s first quarter, per Moody’s—which marked a new record as well as an increase from the 19.6 percent reported in in the fourth quarter of 2023.
To Todd Metcalfe, Moody’s associate director of commercial real estate forecasting and one of the authors of the report, it’s a sign that the “office market is going to catch up to how people already are working.”
Indeed, work-from-home time is now a fixture for many Americans. In late 2022 and 2023, work-from-home time in the U.S. flatlined roughly around 30 percent, according to data from the WFH Research group. In May, it did fall to the lowest level yet—26.6 percent—but remains well above pre-pandemic rates.
Still, Metcalfe says, the “office isn’t going away.”
Hybrid has emerged as the most common and preferred arrangement for remote-capable employees, according to data from Gallup—so the office will still be a core component of many workplaces. Not to mention the companies still enforcing full-time office attendance, Metcalfe adds: “There’s not a one-size-fits-all policy.”
For companies still using the office at least part of the time, coordinating and prioritizing in-person collaboration is key, experts have told Inc. “Otherwise,” Gallup’s chief workplace scientist Jim Harter said, “it’s chaotic, and people continue to regret the commute.”
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(c) 2024 Mansueto Ventures LLC; Distributed by Tribune Content Agency LLC.
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Tags: Firm Management, Small Business
