Rudin Management Company is seeing its New York office properties not only back to what they once were — but even above pre-pandemic levels.

Neil Gupta, Neal Mohammed, Sevinc Yuksel, and Hrisa Gatzoulis, represented the real estate firm on a panel at CREtech New York 2024, discussing CRE trends and how they are going about innovation and adapting to tenant's needs. Gupta highlighted the impressive traffic it's been seeing in its offices in The Big Apple.

"Some of our buildings today are experiencing physical occupancy in excess of the pre-pandemic. There are buildings that are over 100% physically occupied than they were [before]," the president and chief investment officer of the firm said.

"Things are starting to come back on that front — there's some big deals out there."

Currently, New York is experiencing one of the strongest office recoveries in the country. In August, Manhattan offices were found to be 73.4 percent as busy compared with the same month in 2019, according to a recent report from Avison Young. That's up significantly from the national average of 60.4 percent. But Rudin appears to be outperforming both.

As far as deals go, leasing office velocity is " basically on par" with what they were seeing ahead of 2020. Particularly, leasing is standing out for Rudin on Park Avenue, Plaza District, and some areas beyond that in New York City.

PAYING ATTENTION TO AMENITIES AND WORKSPACES

Right now, the theme that's been working for office is "newer or recently amended" buildings, according to Gupta. That trend is also similar to what Rudin is seeing for residential assets.

"Lots of tenants want amenities in the buildings," Gupta explained.

"Sometimes that means conference centers. Sometimes that means connecting with [other] tenants better." The latter could be through an app or a direct line of communication.

Plus, Yuksel spoke about the importance of making use of outdoor space, which is something Rudin is working on now.

"We actually have a lot of buildings in our portfolio that had outdoor space that wasn't being utilized. It wasn't amenitized," she said.

"And so we're trying to do that in the commercial portfolio."

But it's not all about amenities. The actual workspace is starting to change too. A growing trend is open workstations — meaning barriers aren't dividing desks where employees work.

"We're seeing a lot more open workstations; the introduction of different types of spaces into that office design land. It could be digital conference home rooms. That concept didn't really exist before," Yuksel said.

REMOTE WORK ISN'T GOING AWAY

While some of Rudin's office assets are overperforming compared with pre-pandemic levels, Yuksel acknowledged that remote work is here to stay. However, the same can be said about hybrid work.

Rudin can still use that to its advantage, as it operates nearly two dozen residential properties.

"When we renovate apartments, we think about that co-working space," Yuksel said.

She also asked: "Is there a place where people can go take a phone call? Is there a place where they can entertain without being in their apartment? So that's anything from providing a catering kitchen, a TV room [that] has spaces like children's flavors. [Those] are becoming such a big demand."

Given Rudin's performance and recovery in New York for office, the company is keeping a bullish outlook on the asset class. Continuing to adapt will be vital, as office is vastly different than it was even five years ago - let alone last century.