As the pandemic winds on, the big question of what will ultimately unfold for the hard-hit office sector is on everyone’s minds. But a recent analysis by Moody’s Analytics economists say clarity is on the horizon, with 2021 likely functioning as a “transition period” for the troubled asset class in many markets. 

Economists Barbara Byrne Denham and Thomas LaSalvia predict that 2021 “will be a difficult period for the office sector,” though they say a “seismic shift in the demand for square footage is unlikely.” A lag in CRE market stress is likely, they say, but will be followed by a “slow and steady return to pre-pandemic rents and vacancy rates.”

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