Over 80% Of Office Occupancy To Return Post-pandemic

USA – More than 80 percent of office space occupancy level is forecasted to return after the COVID-19 pandemic has been defeated, but the recovery of the office property market could be restrained by 2021, CBRE Group’s CEO & President Bob Sulentic told CNBC’s “Power Lunch” during a televised interview on Friday (11 December).

“Some (property) asset types that are under pressure will start to clearly come back meaningfully after we get a vaccine and see the effects of that.”

“Office buildings – people will go back to work. Retail centres (and) retail buildings will see better occupancy. Yes, there’s gonna be stress for 2 or 3 years, but (there will be) a different picture after we get a vaccine.”

However, industrial and multi-family real estate are expected to recover first. This is followed by office properties, while retail shops and hotels are expected to recover last.

“We think by the second half of next year, we will see much more activity in office buildings.” This is followed by hotels and retail by 2022.”

Queried on the future of office – Are companies going to reduce their footprints? How much less office space is gonna be out there in demand 5 years from now – Sulentic said “we’ll see a hybrid scenario, lots (of people) will be returning to the office. We’ll be gaining 80 plus percent of that occupancy, if not more will come back.”

Another possible scenario is that there could be more flexible space in office buildings and people could work from home. There could also be creative things in the use of office space.

At present, CBRE Group employs About 100,000 workers across more than 530 offices across the globe. It has 6.8 billion sq ft of properties, and has US$114.5 billion assets under management (AUM).

Furthermore, the property firm was involved in US$264.6 billion commercial sales per annum and US$168.2 billion leases per year, as well as negotiated US$58 billion in property loans per annum.