“Parking Lot Index” says workers are coming back to the office
by Erik Hayden, on Apr 13, 2022 9:51:58 AM
It’s more than a little ironic: with all the debate over returning to the office, we at Urban Catalyst have lately found it more difficult to find a parking place at our San Jose office as the local Zoom employees head back to in-person work. (We share a parking lot.)
Of course this “Parking Lot Index” is purely anecdotal but it does seem consistent with broader trends. Google, for one, started requiring employees to work in the office at least three days a week on April 4. Apple employees started to come back to the office on April 11. In the Bay Area, 71% of managers want employees back full time according to a survey from the consulting firm Robert Half.
Let’s look at some stats:
- The National Association of Realtors recently reported that office occupancy rose in 84% of the 390 U.S. metro areas tracked by Costar over the past 12 months.
- Office asking rents were up in 98% of those markets.
- Occupancy is increasing in “major tech” metros. San Jose led in net absorption with 3.5 million square feet, followed by San Diego and San Francisco. (All from a report dated February 25, 2022.)
The reality is that many tech companies experienced significant head count growth during the pandemic. A story in the Denver Business Journal indicated that the number of employees in Zoom’s Denver office doubled during the pandemic.
So even if not everyone is back in the office every day, demand for space is heading up, as the NAR survey concludes. The “Great Return” as it is being called appears to be gaining momentum. A recent Microsoft survey found that about 50% of leaders say their company already requires or is planning to require employees to return to in-person work full time in the next year, as reported by CNBC. Big banks like J.P. Morgan and Goldman Sachs are also bringing people back.
This is all good news for the office market. Meanwhile, here in San Jose, the Parking Lot Index is looking up.
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