682: BiggerNews November: Was The “Office Apocalypse” All Hype?
BiggerPockets Real Estate Podcast
BiggerPockets
4.8 • 16.5K Ratings
🗓️ 1 November 2022
⏱️ 65 minutes
🧾️ Download transcript
Summary
Office investments were supposed to be dead by now. 2020 was supposedly the great exodus, where on-site workers were freed of their commutes, small talk, and trips to the water cooler. We were sold a future where remote work was the only option, where everyone had an at-home standing desk, and nobody needed to wear pants. But, this didn't last long, as companies slowly started taking steps to get workers back into the office, making owners of the offices wealthy once again.
But, with so many companies trying flexible schedules, prioritizing work from home, and renewing their video conferencing subscriptions, will office space still be the same as it was just a few years ago? On this month’s BiggerNews, we brought on Kevin Fagan, Senior Director and Head of CRE Economic Analysis at Moody’s Analytics, to give us the scoop on office investing and commercial real estate in 2022.
Kevin’s team works diligently going through the data behind office investments, highlighting whether or not leases are renewed, how rents are being affected, and if office buildings are truly being abandoned. He brings some good news not only for office space investors, but for real estate investors as a whole, showing that this niche won’t be going away anytime soon. With coworking and residential conversions on the rise, office building investments could be a far smarter move than most investors would assume.
In This Episode We Cover:
How office space investing fared through the pandemic and how far occupancy rates fell
Comparing today’s office investing environment to 2008’s and the stark differences between the two
Office occupancy forecasting and when the data predicts a full recovery
How unemployment rates will affect office investors and whether or not employers will force workers back into the office
The best real estate markets to invest in office space and which big metros to definitely avoid
The benefits of office investing compared to residential real estate and why this low-turnover niche is worth it
And So Much More!
Links from the Show
Find an Investor-Friendly Real Estate Agent
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Get More Deals Done with The BiggerPockets Investing Tools
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Investing in Office Buildings—A Beginner’s Guide
The Coming Collapse of Downtown Office Real Estate
Connect with Kevin:
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Transcript
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| 0:00.0 | This is the Bigger Pockets Podcast Show 682. |
| 0:04.0 | So there's this co-work, and on the world, more calls it Flex Office. |
| 0:08.0 | And I think that's more the appropriate term because when you hear co-working, you think |
| 0:12.0 | more of like the hot desk version of WeWork. |
| 0:16.0 | But Flex Office is actually a subtype of office that's tracked as a subtype of office in places like the UK. |
| 0:25.0 | For a long time, that for the last 20 years now, actually, it's fired in 2003, I think, |
| 0:30.0 | Cushman and Wakefield started tracking Flex Office as a property type. |
| 0:35.0 | What's going on, everyone? This is David Green, your host of the Bigger Pockets Real Estate Podcast. |
| 0:39.0 | Here's today with one of my favorite co-hosts, the amazing Data Deli Dave Meyer with another Bigger news episode, Dave Hower, you today. |
| 0:48.0 | I'm all right, man. I was actually kind of sick, but I was so excited to have this conversation |
| 0:53.0 | that I rallied to talk about this very important topic and get a chance to hang out with everyone here. |
| 0:59.0 | So one of the things I love about you is I too have been rallying after BP con have been pretty sick, but they still must go on. |
| 1:05.0 | And BP, we've been talking about there's like a BP flu going around. |
| 1:09.0 | Like every day, there's just a hangover for sure. It hit me very hard. |
| 1:13.0 | It was a lot. It's intense. It was super fun. But like, it, you know, it's like a pole forward on all of your energy. |
| 1:21.0 | And like, I was just feeling drained for a few days after that. And I don't sleep well. Like if I'm out of town. |
| 1:27.0 | So I was getting maybe three, four hours of sleep a night. And then you combine that with the traveling in the airports, all the hands are shaking, all the hugs and the pictures you're taking. |
| 1:35.0 | Like it was a recipe for getting sick. But still, if I had to go back, I would do it again. |
| 1:39.0 | I'd do it again next week. Well, you're an amp for damn. You know how to partner. It's back to scare you. |
| 1:45.0 | And just a quick word from today's show sponsors. Everyone is wondering where the real estate market is headed. |
| 1:51.0 | Well, how about a better question? How do I make money in any market cycle? |
| 1:55.0 | As times change, the fundamentals of real estate investing don't. |
... |
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