The Future of the Office? It’s Still TBA

The national vacancy rate for office properties ended 2020 at 17.7%, according to recent data from Moody’s Analytics REIS. That’s a 90 basis point increase year-over-year and the latest dire data point for the asset class, which continues to reel from the COVID-19 pandemic and widespread WFH adoption among American companies.

Asking and effective rents were also split: asking rents lifted 0.4%, while effective rents fell 0.7%—a disparity that’s “not so surprising given the typical lags we experience for a property type like the office sector during a time of economic turbulence,” said Victor Calanog, head of CRE Economics at Moody’s Analytics, in a recent video breaking down the firm’s Office Market Update for Q4 2020.