HVAC Breaking News

Nov. 10, 2003: Office Space Needs To Decline Due To Jobs Going Overseas

WASHINGTON - As many as 3.3 million white-collar jobs are expected to go overseas over the next 15 years, resulting in a loss of 660 million square feet of office space, predicted industry analyst Christopher M. Lee, Ph.D., president and CEO, CEL & Associates, Los Angeles, in a seminar hosted by the Building Owners and Managers Association (BOMA) International.

During the seminar, Lee offered insight into the major trends occurring in commercial real estate markets, and explained how those trends are expected to affect the performance of commercial real estate in 2004 and beyond.

Among the trends discussed during the program were:

The average amount of leased space has declined 40 percent over the past 36 months (13,200 square feet in the first quarter of 2000 down to 8,200 square feet in the second quarter of 2003).

Vacant office space has increased 245 million square feet over the past 30 months.

A 250 million square foot absorption rate is required to return to a 10 percent vacancy level (normal annual absorption is 50 million square feet).

Businesses are investing in stock buy-backs and reducing debt, not leasing space.

From Lee's perspective, some of the key issues that the industry must address are: shifting demographics; declining profitability; an artificially stimulated economy; and fluctuating consumer confidence.

For additional information, visit www.boma.org.

Publication date: 11/10/2003

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Greg Mazurkiewicz is Web Editor. He can be contacted at 248-244-6459 or gregmazurkiewicz@achrnews.com. Greg handles the day-to-day operations of The NEWS' website, www.achrnews.com, including the Extra Edition page, which offers additional online-exclusive articles. He has 40 years of experience as a writer and editor. He holds a bachelor's degree in Journalism and a master's degree in Business Management.