The Blubber

The amount of office space in the US is declining for what is likely the first time in history, per Bloomberg.

According to Jones Lang LaSalle, the reduced amount of new construction and the conversion or demolition of aging office spaces will lead to a decline in the availability of office space. In the U.S., less than 5 million square feet (465,000 square meters) of new office spaces have been constructed this year, while a significant 14.7 million square feet have been removed to make way for other types of buildings.

Jacob Rowden, the US office research manager for the commercial property brokerage, noted that historically, the national office inventory has never experienced a decline. He pointed out that the closest instance to negative inventory was during the 1930s, the peak of the Great Depression.

Although vacancy rates during the Depression were probably higher than the current 20% average in the US, there was still notable new construction at the time, including the opening of the Merchandise Mart in Chicago in 1930 and the Empire State Building in Manhattan in 1931.

The evolution of technology in recent years has facilitated remote work, allowing more individuals to work from home on laptops. This shift in work patterns has diminished the demand for large office spaces, even though offices have historically been essential hubs for global commerce and trade, driven by advancements like the telegraph, telephone, tickertape, elevators, and steel-beam construction.