The expansion of the economy and the population should create a full recovery by 2025, according to Cushman & Wakefield, a Chicago-based commercial real estate services company. By halfway through next year, 85.7% of companies plan to return to the office, according to CBRE. But companies have adjusted to work-from-home policies, and office demand could be permanently cut by 15% because of the shift to remote work, according to CBRE.īut the office market should reach bottom and begin stabilizing during 2021. Investors expect workers to slowly re-enter offices after the pandemic subsides. Office spaces face extra hurtle from shift to remote work But cutting costs might be short-sighted - to keep up with new demand for ventilation, health-related amenities and digital proptech, operating costs could actually increase $19.40 per square foot in 2021, according to Deloitte. To weather the tail end of the pandemic, commercial real estate investors plan to reduce costs by 25% on average in 2021, according to Deloitte. “As monumental as 2020 has been, 2021 could be even more influential, as the critical decisions and investment leaders make now could bear fruit over the next 12 months,” said Kathy Feucht, global real estate leader at Deloitte, a London-based professional services network. Meanwhile, warehouses and distribution centers, the one bright spot in the industry, is expected to become even more valuable. More commercial properties will go belly-up during the first half of 2021 before commercial real estate begins to stabilize in the second half of the year, experts say. Hotels, offices and retail storefronts are expected to trail a broader economic recovery next year so investors are pinning their hopes on a COVID-19 vaccine in 2021. If offices, hotels and other commercial properties survive, their luck should change by the end of next year, according to industry experts.
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