Office Owners Already Reeling From Remote Work Now Face Recession Risk in 2023
Owners of office buildings stumbled through 2022 when their holdings underperformed most every other type of commercial real estate. Things look poised to get worse in 2023.
Landlords have been longing for employees to head back to office buildings in greater numbers. But the national return rate has crept up slowly. For the past three months, it has plateaued at about half of what it was before the pandemic.
Now, a possible recession is making the outlook for 2023 even gloomier. New business searches for new office space, after rebounding in 2021, fell in 2022 to 44% of what they were in 2018 and 2019, according to VTS, a firm that operates a data platform that tracks tenant demand.