“We are in the early innings of a multi-decade transformation, with the [office] sector still adapting to the post-pandemic world.”That is the view of CommercialEdge, expressed in its January 2025 national office report. The prospects for office in 2025 appear bleak, “and the worst may not yet be in the rearview mirror,” it added.

The report noted a national vacancy rate of 19.8% -- 150 basis points higher than the year before, and 40 basis points higher than the previous month.

Six of the top 25 markets the company covers saw vacancy rates rise by more than 500 basis points in 2024. Worst off was Austin, where it shot up by 690 bps between December 2023 and December 2024 to 27.9%. Other markets with startling increases in vacancy were the Bay Area and Portland (each up 620 bps), San Francisco and Philadelphia (each up 520 bps), and Boston (up 510 bps).