Remote work continues to be a preference for a significant number of U.S. workers. That means there are empty office spaces left over from what appears to be largely a thing of the past for many corporate employees: commuting to an office for work.
Moody's said there is a shadow of uncertainty for the office sector as commercial real estate business leaders come up with ways to convert what was once office space, into much needed residential space in many parts of the country. The firm said data shows that it is likely that for workers who are still required to come into the office, they will average around two days less for in-office work.
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CBRE said the increase in office-conversion projects has been notable. Nearly 70 million square feet of office space, making up around 1.7% of the total U.S. supply, has been undergoing conversion projects to create residential-use spaces, or spaces for other uses. The firm said the first-quarter numbers this year are up from 60 million square feet of conversion projects the third quarter of last year. That 2023 number equaled about 1.4% of the total supply in the U.S.
CBRE said about 120 conversion projects are expected to be completed in the U.S. this year, and a third of them are expected to create multifamily spaces.
This year, Washington, D.C., reminded residents of its five-year economic plan to "bring people back to our city and neighborhoods," Mayor Muriel Bowser said in March.
The city initiated the goal of adding 15,000 new residents in the downtown area through "office-to-housing conversions."
