|To battle remote work, companies are moving into fancy offices. That’s good news for employees — and bad news for old buildings.
Office attendance, as we once knew it, has completely changed. Fewer workers are coming in, so companies are cutting back on their physical footprints. They’re also being choosier about the offices they’re leasing – favoring spaces with the wow factor to draw employees in.
Because of this, a massive chunk of America’s office market is facing a doom loop. As rising costs make it harder for staid properties to keep pace with the rising standards of quality, more tenants ditch these mediocre offices, which in turn makes it even harder to pay for upgrades, so more tenants … well, you get the idea.
“For years, office owners have been in an amenities war,” one research director told us. “The competition has reached the point where an owner can complete these upgrades and they might not even be enough to push leasing activity.”