Moody's reported a record high office vacancy rate of 20.4% in Q4 2024, driven by the long-lasting impacts of the pandemic and shifts in work culture.
'Over the course of this next year, we're probably expecting it to eventually bottom out,' says Nick Luettke, suggesting an optimistic outlook as companies adapt.
As companies begin to require more in-office attendance, vacancy rates may decline. This is partially due to the expiration of five-year lease terms from 2019.
'Instead, we've seen, even for a lot of hybrid models, there's been a need to reassess how much square footage is really needed,' Luettke noted.
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