“Delta is affecting the when”: Covid variant complicates NYC’s recovery

Sharp rise in cases has left city’s office vacancies at record highs, slowed economic rebound

New York /
Aug.August 24, 2021 12:05 PM
Boston Properties CEO Owen Thomas (iStock)

Boston Properties CEO Owen Thomas (iStock)

One executive with a major stake in New York City’s office market believes a post-pandemic recovery is coming — he just isn’t sure when yet, with the Delta variant sowing chaos into the process.

“I think the return to the office is a ‘when’ question, not an ‘if’ question,” Boston Properties CEO Owen Thomas told the New York Times. “Delta is affecting the when.”

Boston Properties has felt the effects of the Delta variant firsthand. The company owns approximately 12 million square feet of space in the city. Its buildings had returned to around 40 percent of their pre-pandemic occupancy by the beginning of the summer, but that figure has since receded to around 30 percent this month, according to the Times.

The larger office market in the city is struggling as companies push back returns to the office due to concerns about the variant. Major office holders such as Facebook, BlackRock and Wells Fargo have now delayed office returns to October and beyond. The office vacancy rate in Manhattan last month was 17.1 percent, matching a record high set in May.

Meanwhile, the city’s economic recovery isn’t keeping up with other markets across the country. New York City sports a 10.5 percent unemployment rate, almost twice the national average. The city has lost around 500,000 jobs since the start of the pandemic that have yet to be replaced, according to the Times.

Stopping the Delta variant in its tracks is seen as one way to boost the city’s recovery. In addition to floating a $100 incentive for those who receive their first dose at city-run vaccination sites, the de Blasio administration has implemented a vaccine mandate across many indoor businesses and locations across the city, though enforcement on the mandate isn’t coming until next month. At least two groups have sued the city over the mandate.

[NYT] — Holden Walter-Warner





    Related Articles

    arrow_forward_ios
    Carpenter & Company's Richard Friedman and 2 Canal Street in New Orleans (Carpenter & Company, Google Maps)
    New Orleans Four Seasons lands $315M loan from Madison Realty Capital
    New Orleans Four Seasons lands $315M loan from Madison Realty Capital
    HUBB’s John McCarthy, Greystone's Thomas Ryan and 223-225 4th Avenue (Google Maps, Greystone, Getty)
    HUBB NYC continues 421a spending spree, buying Park Slope building
    HUBB NYC continues 421a spending spree, buying Park Slope building
    120 East 39th Street (Hotels, Getty)
    Short-term rental company taking over Midtown hotel
    Short-term rental company taking over Midtown hotel
    One Soho Square with Stellar Management’s Larry Gluck and Yotpo CEO Tomer Tagrin (LoopNet, Twitter, Gluck Family Foundation)
    Yotpo inks 30K sf sublease at Stellar’s One Soho Square
    Yotpo inks 30K sf sublease at Stellar’s One Soho Square
    From left: Landlord Steve Croman and White Horse Tavern owner Eytan Sugarman along with the White Horse Tavern at 567 Hudson Street (Getty Images, Google Maps, Instagram/boyfromnewyorkcity)
    Croman sues White Horse Tavern owner for $650K back rent
    Croman sues White Horse Tavern owner for $650K back rent
    Blackstone's Stephen Schwarzman and 8 Spruce Street (Photo Illustration by Steven Dilakian for The Real Deal with Getty Images and Twitter/AAsArchitecture)
    Blackstone’s 8 Spruce sues tenant over alleged pop-up restaurant
    Blackstone’s 8 Spruce sues tenant over alleged pop-up restaurant
    A photo illustration of Tishman Speyer CEO Rob Speyer and 28-10 Jackson Avenue in Long Island City (Getty Images, Tishman Speyer, Google Maps)
    LIC tenant claims Tishman Speyer violated rent stabilization
    LIC tenant claims Tishman Speyer violated rent stabilization
    A photo illustration of Nir Meir (Getty Images)
    HFZ investor wants Nir Meir held in contempt
    HFZ investor wants Nir Meir held in contempt
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...