Newsletter Winter 2021: Office Demand, Proptech, Adaptive Reuse and More

Although office net absorption remained negative throughout 2021, it is gradually climbing toward the positive side of the scale.

Office utilization rates remain low due to continued concerns about coronavirus transmission, and the Omicron variant has also introduced a new degree of uncertainty.

However, while a long-term increase in remote and hybrid work arrangements is likely to reduce demand for office space, the authors of the latest NAIOP Office Space Demand Forecast predict this will be more than offset in coming years by employment growth in office-using industries.
 
Demand for new office buildings is also favorable, as new builds offer the flexible work environments demanded in today's more uncertain world.

 

VIEWPOINT

 

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MEET A GOVERNOR: Skip Kalb

"In the next five years, I believe we’ll continue to see the blending of asset classes accelerate,” said Kalb, president of Skip Kalb Strategies, LLC, and 2022 NAIOP Research Foundation chair.

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Research Preview 

New Uses for Office Buildings

In the wake of the COVID-19 pandemic, office markets across North America are experiencing high vacancy rates. At the same time, demand has grown for other property types such as life science and multifamily real estate. This dynamic has led more developers to consider converting older and underperforming office buildings to new uses, particularly in land-constrained markets. But not every office building is a good candidate for conversion. 

The NAIOP Research Foundation has commissioned Emil Malizia, Ph.D., professor at the University of North Carolina at Chapel Hill, to evaluate the risks and opportunities associated with converting office buildings to life science, multifamily, and medical office uses.

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