Office Building Leases Are Still Intact, But Workers Aren’t Showing Up

Remote work is a thing, and chances are that many of those who have set up shop at home won’t be returning to the office, at least, not in the same numbers as before. We need to understand how big this change will be. Luckily a company, Kastle Systems, can provide such insight.

While Corporate real estate giant CBRE reports that corporate leases barely dipped in the second quarter, with the vacancy rate edging up slightly by 0.70% to 13%, the company also said that the price paid for leases increased 0.3%, and up 3.7% over the second quarter of 2019. That’s nice, but it doesn’t tell us who is in the building.

Kastle Systems handles secure access, think key fobs and security cards, for more than 3,500 buildings and 40,000 businesses across the country.  According to their data, during the week ending October 12, just 26.3% of office workers across 10 major metropolitan areas were back working on site. The highest percentage was in Dallas, Texas, at just over 40%, and the lowest was in San Francisco, at just under 15%.

San Francisco also happens to have the highest-priced office space in the nation. If this trend of working from home continues, large cities will lose tremendous amounts of tax revenue, including everything from sales tax to commercial property tax.

It’s going to get ugly out there.

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