Marcus & Millichap

Office Health Crisis Special Report

April, 2020

Special Research Report

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Outbreak Raises Questions About Future Office Demand; Coworking Space Faces Significant Overhaul

Tenants to reevaluate space needs and practices. The implementation of stay-at-home orders across the country forced many companies to adopt remote working solutions, a behavior that could have long-lasting repercussions for office investors. Prior to the health crisis, approximately 3.5 percent of the nation’s labor force worked from home and over the past five years the number of U.S. remote workers increased 43 percent. Now, temporary closures due to COVID-19 safety regulations are forcing nearly all firms to reevaluate space needs as employees become more proficient in digital technology while working remotely. However, a structural shift into dispersed working practices following the lift of government guidance on social distancing is unlikely. Productivity levels will be reestablished by bringing employees back together following weeks of disconnect. Working from an office can ensure employees have the right technology setup to do their jobs efficiently, while they may not have access to the same tools remotely.

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