Here's a bad combination of factors in the office segment of CRE: most businesses expect a recession in the near future, and although office vacancy is about 15.1%, occupancy is somewhere between 43% and 44%.
The former means that corporations will expect to cut costs to lessen the impact of a recession. The latter kicks in because if your company doesn't seem to need something it has been paying for and saving money is a critical strategy, cutting those extraneous costs would seem a logical conclusion.
That flips the pressure onto the already suffering office sector. Owners need tenants, unless they have a better idea of how to use the space they must pay for—including taxes—and support. When corporate outlooks on economics are reserved at best, that can mean being less discriminating. But short-term thinking can make for longer-term pain.
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