Office and retail markets have been highly affected by the pandemic. The office market has seen a large uptick in companies who are looking to sublease their space. The retail market has also been affected by retailers wary to open any new stores because of the county restrictions and ban on indoor and outdoor dining. The industrial sector has been the most stable of the submarkets with many companies still needing warehouse space to use for their distribution needs.
Even though the need for industrial space is still strong, vacancy rates are constantly rising in all the commercial real estate subtypes. We expect the retail market to recover after the restrictions on dining have been lifted and most people have been vaccinated. We expect the office market to recover as well but don’t expect it to really come back until 2023. When it does come back, I expect that companies will lease less office space than before and will allow their employees to have a hybrid option where they can choose when to come to the office and when to work from home.
By Jake Lloyd, Commercial Realtor, Collliers International
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