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Originally Posted by Waimea
Agree. I also think another factor is office space demand has been cut to near 50% (if not more) of what it was and I don’t ever see it bouncing back to the 2019 levels. Not to be pessimistic but I would not be surprised to see Kensington, the proposed tower on state street, and a few others to never come to fruition. The only reason I think projects such as the CCH, 95 State, etc. happened is because they started construction before this scamdemic (I mean pandemic) happened. The funds were in place and maybe even pre occupancy had filled up the tower enough, and simply the ball was already rolling on those projects. Hope I’m wrong but time will tell.
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I disagree, particularly for downtown SLC. I used to be super pessimistic about the economic impact of this very real pandemic. However, Utah has proven itself to be extremely resilient over the past year. We are already back to 'full employment' and with most people set to be vaccinated in the next 90 days or so, the crisis is about over.
I also am optimistic about downtown office space. With so much population growth recently, both in Utah in general and in the downtown area, that will likely push demand for downtown office space longer term. I have seen many reports also indicate that future office space will see employees more spread out, therefore increasing the overall need for square footage. Utah has also not seen the corporate bankruptcies or mass office exoduses that some other states have seen and is therefore starting off from a much better position.
I also think the vast majority of people and companies do not want to work fully at home. Some do, which will change the market a bit. But many homes and apartments are not well equipped for at home work spaces. The more we see construction of micro units or smaller apartments as well, the more likely those people will not want to work in their small spaces. Again we will see, but with things set (as of now) to return back to normal by June or so, we should have a much clearer understanding of the future of the market by then.