Post Covid Impact On Commercial Real Estate

Posted By CIMLS Staff on Jan. 15 2023 at 3:07 AM EST
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The COVID-19 pandemic has had a significant impact on the commercial real estate market. The impact has varied depending on the property type and location, but some general trends that have been observed include:

Office: The shift to remote work has led to an oversupply of office space in some markets, as companies reduce their physical footprint and employees continue to work from home. This has resulted in lower occupancy rates and rent growth in some markets.

Retail: The pandemic has accelerated the shift to e-commerce, leading to store closures and a decline in retail sales. This has resulted in lower occupancy rates and rent growth in some retail markets.

Industrial: The pandemic has led to an increase in e-commerce and home delivery, resulting in a high demand for warehouses and distribution centers. This has led to strong occupancy rates and rent growth in some industrial markets.

Hotel: The pandemic has led to a decline in travel and tourism, resulting in lower occupancy rates and rent growth in some hotel markets.

Multi-family: The pandemic has led to an increase in demand for rental housing as some people have been displaced from the office or hotel sectors. This has led to strong occupancy rates and rent growth in some multi-family markets.

It's worth noting that these are general trends, and local markets and conditions may vary. The commercial real estate market is expected to recover as the economy recovers and a significant number of people start to return to their workplaces, but it may take some time for the market to return to pre-pandemic levels.