Despite the pandemic’s devastating impact on the office market, downtowns and nearby walkable neighborhoods are looking forward to two decades of growth driven by demographic and economic change.
DAVID DIXON APR. 18, 2022
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Over the past two years I have heard colleagues express growing pessimism about the future of North America’s downtowns. And why not? In its April 2021 report, “To Recover From COVID-19, Downtowns Must Adapt”, Brookings noted “Across the U.S., the pandemic has left downtowns ‘cratered,’ ‘devastated,’ and ‘abandoned.’ ” Why? Because, as Brookings noted, “Downtowns Revolve Around Office Space.” In 2019 office represented more than 70 percent of downtown square footage in the top 30 US metropolitan areas. While no one yet knows what post-pandemic office occupancy will look like, neither Brookings nor most other observers suggest a rebound to pre-pandemic levels. In fact, to make a stronger case for pessimism, the pandemic did not launch, but instead accelerated the trend toward hybrid work (although how many of us ever used the term before March 2020). Net new absorption of office space across North America has been declining for at least two decades. This has meant a roughly 50 percent decline in downtown net annual absorption since the early 2000s—before considering the pandemic’s devastating impacts.
