Boston Metro commercial real estate experienced dynamically different market conditions during 2020. While the pandemic helped increased demand for lab space and warehouse space, it had significant, adverse impacts on retail, hospitality and office sectors. Now that vaccine distribution is in the early stages, there is some question about how soon these troubled sectors will see relief.
To evaluate this objectively, we must consider where things stand today in the final weeks of 2020. According to a report by Newmark, office vacancies have risen above 10% in downtown Boston, and are averaging 13.5% across the metro area. The amount of available office space is currently double the square footage that was on the market during the Great Recession – a feat partially attributed to new developments reaching completion just as the pandemic struck New England.
As office employees adapted to work-from-home, students acclimated to remote learning. The cancelation of major events and the closure of tourist attractions completed the “perfect storm” of traffic loss, which has decimated the restaurants, service providers and retailers who relied on these populations.
Even as vaccines begin to reach the public, it will take quite some time for commercial real estate demand to find a balance. No one is certain when vaccines will be available to all, and much is unknown about the long-term effectiveness of the vaccines themselves. Certainly, an anxious, pent-up public is ready to shop, dine and travel, as well as work and study in person, as soon as it is practical to do so. But 2021 is likely to bring us gradual steps towards normality, rather than an abrupt return.
For those taking the long view, the current market environment offers an excellent time to negotiate the lease or purchase of Boston Metro commercial real estate! It is also a good time for investors to consider their opportunities in the market.
When you are ready to begin, relocate or expand your business, team up with the Jay Nuss Realty Group, LLC! Whether you are thinking of buying, leasing, or investing in Boston Metro commercial real estate, we can help you find the ideal property.
Contact us today for expert guidance!