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Special Report

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April 2022

Big Tech Doubles Down on Space;
Return to Office Approaching

Omicron a minor setback, but attitudes are shifting. Before the omicron wave, office leasing activity had reached its highest levels since the onset of the pandemic. The space available for sublease also declined, most importantly in central business districts. Omicron interrupted this positive trend, raising vacancy in CBDs by an estimated 30 basis points in the first quarter of 2022, while suburban rates remained stable. The subsequent slowdown in cases is welcome news for office owners. If the U.S. does not face a new, serious pandemic wave, it is likely performance could reinitiate pre-omicron trends. Changes to gathering rules in prominent office markets, such as New York, Bay Area, Los Angeles and Seattle, also suggest more employees will return to offices, at least part time, soon, providing another tailwind for office demand.

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