Working from home was something that many people wanted before 2020, but then it became reality in an unimaginable way. As Covid spread across the planet many people were furloughed or lost their job completely. Millions of others were told to work from home.
As many businesses decide to continue with remote working, office space across the states and in other countries remains empty. There are now more empty offices in New York than at any time in the last 30 years.
As areas that were once dense with commuters start to turn into ghost towns, the question arises, what will happen to these buildings? It isn’t only the offices that are empty either; many retail units, bingo halls, and licensed premises have all closed down due to the pandemic.
How much empty space is there?
Just looking at the major retailers who suffered losses and filed for bankruptcy last year is hard enough. There were over 12,000 retail unit closures last year from chains alone, which adds up to nearly 160 million square feet of space.
Twenty-five percent of malls are expected to close over the next few years, taking with them around 80,000 units. And it isn’t just the US that is seeing huge closures.
In the UK, high street bookmakers that are highly popular with sports bettors shut during lockdowns, with hundreds closing permanently. Bingo hall chains announced wholesale job losses as they decided they could no longer continue, and casinos also suffered.
As social distancing rules and lockdowns were imposed, casinos closed including brand names such as Genting. The result was that individuals went online to play at Energy Casino, MGM, Mansion, and other internet casinos. If they don’t return, more businesses will fold.
What are the positives of all the empty space?
Although it is easy to look at empty offices, retail units, and other premises, as being negative, there are some positives too.
Where there are empty offices there is the potential to create something more. Where there are empty buildings such as casinos, then there is a chance to regenerate.
Employment has been affected in most countries during the pandemic, and one of the priorities of local governments is to create jobs. Another priority is to find homes for the people that are homeless, soon to be homeless, and those who are struggling to afford a home.
By investing in some of these buildings, both employment and homes could be created.
What could be done with the empty offices?
Empty offices could provide several types of housing for vulnerable people and those on low incomes. They can also give a chance for someone who wants to find alternative ways to get into real estate.
Millions of people in the states are not in a financial position to buy their own homes. With all the empty office space available, there is the opportunity to convert these into affordable housing.
For investors, there is room to make more luxurious apartments from offices, and as many office blocks are in city centers, they could provide a way to successfully invest in real estate during a pandemic.
Then there are the homeless. With so much empty space available, this could be the time to make a real difference.
Providing shelter for the homeless
Unfortunately, it isn’t possible to wave a magic wand and fix the problem of all the people who have no homes. There may be thousands of empty offices ready to be converted into homes, but someone still owns them.
Investment and donations will be needed for charities and initiatives to get hold of the empty properties, however, if they can raise finances, they could take thousands off of the streets.
There are currently around 580,000 people homeless in the United States. The figures for homeless people were dropping year by year since 2007, but now they are rising again. It is likely as the pandemic hits people’s livelihoods even more that this figure will rise.
Empty offices could provide temporary shelter to get people off of the streets. They could also be converted into small self-contained units to provide a safe longer-term solution also.
Rejuvenation could create jobs
It isn’t only offices that are empty, so there is also an opportunity for regeneration and job creation. There are many property investors looking to take advantage of the commercial market.
Larger buildings can be converted into entertainment destinations. Perhaps cinemas will no longer receive the amount of custom they once did, so smaller theaters may work better. If there is a market, building an entertainment center with a small cinema, shops, restaurant, perhaps even a casino, could create jobs and improve the look of an area.
Speaking of casinos, perhaps some laws will need to be changed to help other businesses grow. Some states still don’t allow online casinos to have their servers physically based there. If this changed then businesses such as Mansion or Energy Casino could run their slots and other games in the US. This would mean job creation and empty buildings being used once again.
Hotels and restaurants could also be created out of empty offices and other buildings. This could work if the area was once popular with tourists, and some regeneration could bring it back.
Investment opportunities
Aside from helping low-income families, the homeless, and creating jobs, empty real estate presents an opportunity for investors.
Many people enjoy flipping houses for a living, and a move into commercial property might be a good move now. With empty commercial property at an all-time high, it is the perfect time to snap up retail units and office space.
Of course, careful consideration needs to be taken when buying, or the investor may just end up the proud owner of an empty office.
Summary
Some experts have said that there may be up to 30% fewer offices needed after the pandemic. Many businesses have decided to keep the remote working format as it has led to many benefits. This means that there will be opportunities for investors and charities to create something different.
What will be created out of these empty sites remains to be seen.
Published on Holr Magazine