When it became obvious that WFH was working so well for so many, it occurred to me that REITs might eventually take a serious hit.
What goes around comes around eventually, and at some point having a physical office might just become trendy again, totally apart from economics, and if rents really go down and make it affordable, a smaller footprint might become the norm. Think of the money that’ll be saved when companies’ existing leases run out. I’ll bet commercial cleaning companies are feeling the pinch now.
My son manages a landscaping branch, and they have some customer locations that are essentially abandoned. Grass still needs to be cut etc, but snow removal and ice treatment is definitely optional. At what point do these sites get converted to something else?
No way would I invest in a REIT right now. Companies love dumping overhead, and the work from home narrative fits the bill. I can see existing office space being converted into housing for immigrants. An exist office building would warehouse people nicely. Biden’s border problem is solved!
