The big question since the pandemic: Will workers return to the office or is remote work here to stay? Already, some commercial forecasters are surprised by the reversal of what they thought would be a lasting desire to work from home. Office spaces may once again grow in demand soon.
While tech firms may be the most connected for a remote-work world, they’re showing some eagerness to lead the way in returning to work. Tech giants like Amazon and Google are pushing for a full-time return to the office and are even expanding their offices nationwide. After more than a year into the pandemic, some tech firms are joining other companies to pull back from the long-term trend of working from home that they anticipated.
Many companies are adopting a hybrid work setup for returning workers, allowing them to split their time between working from the office and home. But with COVID-19 vaccine rates up, other companies want employees back to the office full-time.
Amazon officials said last month that “an office-centric culture is our baseline” after the pandemic. The company has been preparing for it with some major commercial purchases.
Both Amazon and Google have been expanding their real estate footprint since the pandemic. For example, last August, Amazon signed a multimillion-dollar deal for an office tower in Bellevue, Wash. In February, the company unveiled its second headquarters in Arlington, Va., to be completed by 2025. In March, Google announced it would be investing $7 billion in office space and data centers nationwide this year.
Still, not all companies are ready to jump back to office life. Office vacancy rates grew considerably over the last few months, notably in Seattle and Austin, Texas, due to new supply and shrinking office footprints, the Commercial Property Executive news site reports. Of 114 markets tracked by Commercial Edge, only 18 markets have shown growth in office employment, with Salt Lake City and Raleigh-Durham, N.C., leading the way.
Nevertheless, office development continues as developers bet over the long term that physical offices will remain part of workplace culture. About 162.6 million square feet of space is under construction nationwide. Seventy percent of that stock is located in urban submarkets.