Moody's Ratings has downgraded San Francisco's credit rating to Aa1 from Aaa, citing the detrimental economic effects of high office vacancies driven by remote work.
The sea change in office employment has led to reduced economic activity, very high vacancy rates, and depressed rents, as highlighted by Moody's concerns.
San Francisco's Downtown office vacancies hit a record 37.3 percent, leading to a post-pandemic collapse in the office market that has reset property values.
With the shift to remote work and fewer office hours, local spending has decreased, contributing to the overall economic downturn impacting the city's credit rating.
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