Interest in small suburban offices is picking up as more people continue to work from home, and relocate outside of major urban centers.
For IWG, the short-term office company, deals for its downtown New York offices have collapsed by 30 percent since the virus outbreak, while activity in southern Connecticut has surged more than 40 percent, according to Bloomberg. Similarly, sales of small offices accommodating one to two people have jumped 19 percent.
IWG recently indicated that it would close up to 20 percent of its flex office spaces in Manhattan, as its Regus subsidiary puts locations throughout the city into Chapter 11 bankruptcy proceedings.
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Still, the suburban migration is happening, and office landlords are responding. “This shows the current trend of buyers wanting more space — inside and outside of the house,” London-based analyst Iwona Hovenko of Bloomberg Intelligence told Bloomberg.
Few employees have returned to their offices in New York City: In Manhattan, just 10 percent of workers have so far made a comeback. Experts originally projected that 26 percent of employees would return to their offices by the end of the year.
[Bloomberg News] — Sasha Jones