Assessing the work-from-home impact on US office demand
The work-from-home movement has proven it has staying power. As a main driver of the structural shift in the office sector, the disruption from increased work from home is having a lasting impact on office performance. Office net operating income yields will expand significantly this year and we project office capital values will fall by 16.4% in 2023 and by 2.1% in 2024.
What you will learn:
- But the effect from work from home on office demand at the metro level is more nuanced. If more workers in a certain metro are opting to be hybrid versus fully remote, the negative impact on demand will be less severe. The shift to more hybrid work, coupled with other demand drivers, such as office-using employment growth, will paint a clearer picture of office performance in the forecast period.
- Those metros with an above-average increase in the share of hybrid workers and the largest drop in the share of fully remote workers were gateway markets (New York, San Francisco, Washington DC, Los Angeles, and Boston) and Sunbelt markets (Dallas and Atlanta).