17/01/2024
🏢💼 Breaking: New Record for Empty Offices in the US! 💥📉
https://www.wsj.com/real-estate/commercial/offices-around-america-hit-a-new-vacancy-record-166d98a5
From January 15 to 19, 2024: L'Opinion reveals, "Historically vacant offices in La Défense, while Paris thrives." Major corporations are hunting for smaller, yet central and well-connected spaces to entice employees.
The office vacancy rate now hits nearly 16% in La Défense, a historic high surpassing the 2013 crisis, in contrast to 2.3% in the central business district of Paris, according to the Immostat barometer.
Watch out for cobwebs. Come next fall, French employees of the giant temp agency Manpower will be the first occupants of the Landscape tower in La Défense, delivered two years ago after years of construction. Meanwhile, Peugeot's former headquarters in Paris, near Porte Maillot, secured tenants two years before completion during a full restructuring phase, as reported by L'Opinion.
Despite La Défense's excellent connectivity, its vast spaces struggle to find takers, echoing the US situation: "Offices Around America Hit a New Vacancy Record: 19.6% of office space that isn't leased since 1979," a somewhat misleading title to soften its impact. In 1979, there were not only fewer companies but also fewer residents, not to mention the sheer square footage. Read more in the WSJ.
Zero Hedge (ZH) concurs: "New data from Moody's shows that 19.6% of office spaces in major US metropolitan areas were unleased in Q4 2023, surpassing the previous record of 19.3% during the commercial real estate downturn between 1986 and 1991.
In a previous report, the Mortgage Bankers Association found that $117 billion in commercial real estate (CRE) office debts are due for repayment or refinancing this year.
This debt is concentrated in Democrat-led cities like New York (Manhattan), San Francisco, Chicago, and Los Angeles. Unless the Fed aggressively starts cutting rates by March, owners will struggle to refinance this debt."
Translation: Banks' losses are set to skyrocket in 2024, potentially triggering bankruptcies. 💼📈 🌐💔
The 19.6% of office space that isn’t leased in major U.S. cities is the highest since at least 1979.