1 implication is going to be defaults and foreclosures. Rosen worries that if companies continue to give up their leases, those who own these office spaces won't be able to collect rent and make good on their loans. That's even more than the vacancy rate following the 2008 financial crisis. REZVANI: So weak that about one-fifth of office space across the country is sitting empty. And so leasing for office buildings has been very weak. So companies, when their leases are up, they're cutting back their uses of space. KENNETH ROSEN: The typical building has about half the number of people in it as they normally do. With high inflation, climbing interest rates and tightening credit from recent banking turmoil, companies are assessing whether they need all that pre-pandemic office space at all, says Kenneth Rosen, chair of the real estate research firm Rosen Consulting. REZVANI: Many companies here have pumped the brakes on a full-bore return to the office. And I got to say, it looks pretty busy.īut Caleb Brown, a barista at the coffee kiosk, tells me it's not always bustling like this.ĬALEB BROWN: Most people are only here Tuesday through Thursday, gone Mondays and Fridays. People have come out of these high-rise buildings. Aboveground on this Thursday afternoon, a lot of white-collar workers seem to be here at work. UNIDENTIFIED PERSON #1: Are y'all still coming in tomorrow? So here I am, waiting and hoping the customers come back. But, hey, you got to start sometime if you want to try to make the comeback. When he reopened, he thought he'd see them all again. That all stopped when Sears shut down his shop for more than a year because of the pandemic. They used to leave their broken soles with Sears in this underground plaza before heading to work aboveground in nearby corporate towers. REZVANI: These shoes mostly belong to lawyers, consultants and financial advisers. SEARS: You know, they were here pre-pandemic, and they've never picked them up. Drawers full of heels, boots, loafers, all dropped off at his shoe repair shop here in downtown Los Angeles back in 2020 and long forgotten. JAMES WALLACE SEARS: These are pandemic shoes.ĪREZOU REZVANI, BYLINE: For the last few years, 80-year-old James Wallace Sears has kept a collection of what he calls pandemic shoes. NPR's Arezou Rezvani visited one block of downtown Los Angeles. And while many people, of course, have long since returned to the office, more than half of Americans now work from home either some days or every day, which has left many corporate towers and office spaces empty. The pandemic intensified a trend of working from home. For some people in this country, the return to the office has not really happened.
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