The U.S. commercial real estate sector has been dealt another death blow when it comes to the real data and numbers, which reflect the current market reality due to the COVID-19.
There are tens of millions of square feet sitting vacant in thousands of empty commercial buildings across the nation.
A new report analyzing the data of 3,600 buildings and 41,000 businesses across 47 states from Kastle Systems shows just how bad the trends are regarding how many Americans are or plan on returning to the office.
It does not bode well for commercial property owners.
The report shows that the occupancy rates nationwide decreased significantly last week, with the 10-city national average down to 17.6% — an 8.1% drop from the week prior. Every city on the survey experienced a sharp decline in occupancy.
The city with the largest decline was on the West Coast, with Los Angeles falling 27.5%, followed by three Texas cities – Dallas at 24.2%, Houston at 22.8%, and Austin at 22%.
The pandemic and social distancing have killed the demand for office space, possibly even after a vaccine is developed and the virus has gone.
This new reality is causing massive turmoil in commercial markets and will continue in the months and years ahead as we work through all the bad loans and foreclosed properties.
This new post-COVID-19 reality for commercial real estate shows that a lower number of workers have gone back to the office, proving that more Americans are working from home or simply unemployed.
It will take a long time to work through the mess and adapt to our new working realities. Human and social interactions, along with new businesses, will come back. Still, it will be a different world, and it is doubtful things will ever go back to pre-Covid.
Property owners will need to get creative and also brace for the tsunami of evictions and lawsuits as we head in 2021.
If you own property in Southern California and are in need of a professional commercial property inspection or field services, please contact us to speak with an expert about your project at 619-514-4419.