More workers have returned to the office than at any time since the start of the COVID-19 pandemic, according to card reading data from Kastle Systems, a provider of building security systems.
During the week ended April 6, the average occupancy of 43.1% across Kastle’s 10 cities increased from 42.0% the previous week. So, more than two years after the pandemic hit the United States, more than half of office space in the United States is unused, according to data from Kastle.
As always, the highest occupancy rates are found in three Texas metropolitan areas: Austin (63.0%), Houston (55.5%) and Dallas (50.9%). The largest increase occurred in the Chicago metro area, with office occupancy rising from 34.5% to 37.8%, followed by the San Francisco area, which rose from 31.8% to 34 .2%.
Occupancy fell in only two regions – Dallas, which fell to 50.9% from 51.4% and San Jose, which fell to 33.0%, the lowest occupancy rate of the 10 regions, against 33.5%.
Clearly, office REIT stocks have been depressed since the pandemic. The S&P Composite 1500 Office REITs Index is down 3.9% since March 1, 2020, while the S&P 500 is up 49%, as seen in this chart.
By name, Office Properties Income Trust (OPI) fell 20% during this period, Paramount Group (NYSE: PGRE) fell 14%, Highwood Properties (HIW) fell 7.8% and SL Green (SLG), which focuses on the New York market, fell 6.6%.
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