Remote work empties offices, putting billions in building value at risk
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Demand for office space has weakened due to remote and hybrid work, similar to the retail apocalypse that shuttered malls. Empty offices could be repurposed, like malls turned into police stations or cannabis farms.
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Remote work puts $800 billion of office building value at risk by 2030. Conversion depends on costs and demand for new uses like housing.
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US office vacancy will likely rise to 19.8% in 2024, up from 12.1% in 2019, as construction slows. More vacancies raise prospects of defaults.
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Employers struggle getting workers back to offices, even protesting return mandates. This suggests remote work will continue eroding office demand.
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Biden's top economist Lael Brainard sees increasing signs of a "soft landing" where inflation falls without recession, though risks remain.