As COVID-19 restrictions began to loosen throughout the third quarter, we saw businesses begin to reopen and employees slowly start to return to the office to work. Although some tenant demand resumed over the third quarter, the office market can be largely characterized as “frozen,” with many businesses operating as if they are in a “holding period.” While we did report a substantial increase in total sublease space and consequently, significant negative absorption (-256k square feet), this was largely attributed to a single tenant, WorleyParsons.
Although we don’t expect the market to bounce back to “normal” overnight, we remain optimistic about the future in the long term despite a currently stagnant market, as groups will still require office space to foster culture and drive collaboration.
