Empty offices amid construction boom reach record levels
Cranes are popping up in plenty of major cities across the world, yet existing buildings have never looked emptier.
This is the reality for global capital cities that are experiencing huge construction projects whilst simultaneously plenty of office buildings are continuing to remain empty and/or disused.
About 105m square ft of office space is vacant across the UK in particular, according to the latest figures from CoStar, a property analytics provider. In addition, in April 2023, the company reported that this volume of space is an increase of 68% on the 62.5m square ft in the month before the pandemic.
Construction priorities shift with hybrid working patterns
The Times recently reported that this is possibly the highest level ever recorded as reduced demand from businesses clashes with a construction boom. The UK has seen a decline in construction output in 2023, which this could have contributed to.
Last year, it was recorded that vacant space in London was up by 50% since 2019 and it is clear that this figure is continuing to rise. As well as vacant offices, homes are also being left bare, reaching its highest level since 2010.
The BBC also stated that 34,327 properties were classed as “long-term vacant” as of March 2022 and saw the government criticised for not adequately tackling the country’s housing crisis.
More globally, vacant office space in the US accounts for 17.8% of all offices, which is the highest figure recorded since the 1990s. Real estate company Coldwell Banker Richard Ellis (CBRE) in California released these figures, stating that the vacancy rate in New York alone was 17.4% - the highest rate recorded by the company since it started collecting data in 2000.
The state has the largest office building market in the country and has more than 74,582,671 square feet of vacant office space - enough to fill more than 26 Empire State Buildings. However, tourism has exploded in the shadow of the pandemic, with hotels in New York having hit 90% occupancy in a nationwide high, according to The Independent.
Chicago and San Francisco are also cities hugely affected by an empty office pandemic, which has caused residents to argue turning disused spaces into new housing.
Adapting existing buildings?
Industry professionals have considered how technology and rapidly advancing AI could cater well to the construction boom. However, the issue of vacant buildings leaves questions over what purpose they serve, or if they could be adapted to suit a different need.
It comes amid a big change in the way tens of millions of US people are working, fears of a looming recession and companies either offloading their buildings or not renewing leases, as every sector adjusts to a new normal.
The pandemic has irreversibly changed the way in which people work and how companies view their offices. With many staff now working from home for at least part of the week, occupiers no longer need the same amount of space.
It will be interesting to see how this impacts the construction industry and if already existing buildings that are no longer used for their intended purpose will need to be adapted moving forward.
