Vacancies in Boston Office Space at 20 Year High

Catherine Carlock has an article in the April 15, 2023 Boston Globe detailing the surge in office vacancy rates in Greater Boston. It started with the pandemic when many white collar professionals worked remotely. As Carlock says, the market took a "wait and see" attitude about whether office vacancies would stay high as the pandemic ended.As she says, we are seeing. More workers are doing their jobs remotely and as a result, the regional office vacancy rate was 19.1% in January, the highest in 20 years. And since January, more than 1.5 million SF of office space has been vacated - nearly a full Hancock Tower's worth.But it's not all bad news, as newer Class A towers (with the best amenities, the most modern conveniences) fill up, older Class B and C office space is struggling to lease up.Office buildings that are for sale are not a great investment at this time, with properties losing sometimes half their value. Loan defaults are also a concern, certainly for variable-rate loans.72% of Boston's $4.28 billion in budgeted revenue for this fiscal year is expected to come from property taxes, but the city's administration says its not worried. There are still businesses choosing to locate in Boston, notably Lego, relocating from Enfield, CT to Boston and the law firm Goulston & Storrs.