As the remote work debate continues, some wonder whether the push to return to offices is making a tangible impact in metropolitan areas. Placer.ai explored office recovery trends in Manhattan — New York City’s financial epicenter — and it provided some answers.
Office Visits On The Rise: Despite the substantial financial hit, with a reported loss of $12.4 billion annually due to emptier streets and offices, Manhattan is seeing a resilience that outpaces many of its urban counterparts. During a four-month period in mid-2023, visits to Manhattan office buildings, as tracked by the New York City Office Index, saw an uptick compared to January 2020’s baseline.
Notably, NYC’s office recovery has consistently surpassed the national average since June 2021.
Data from Manhattan’s top office buildings indicates an increase in foot traffic, likely a reflection of strict return-to-office policies. For instance, Goldman Sachs Group Inc GS, with CEO David Solomon staunchly opposing remote work, saw a 16.5% surge in the average frequency of employee visits between June 2022 and June 2023.
Citigroup Inc’s C stricter in-office policy enforcement echoed the trend with a 24.3% rise in the same period. Overall, the New York City Office Index noted an 8.4% increase in employee visits.
A Shift In Office Visit Patterns: Interestingly, Placer.ai noticed a shift towards a hybrid work model when it examined the days employees choose to be on-site. Increasingly, employees are heading into the office midweek — particularly on Tuesdays — while preferring to work remotely on Mondays and Fridays.
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Beyond the towering skyscrapers of Midtown and Lower Manhattan, each neighborhood is showing distinct recovery trajectories. Placer.ai noticed that Midtown and Lower Manhattan have the slowest recovery rates, with year-over-year weekday worker visit gaps at 29.1% and 16.4%, respectively. In contrast, Upper Manhattan’s foot traffic was only 8.2% below its 2019 numbers, suggesting a higher concentration of on-site jobs.
More to that, the variation in recovery rates may be influenced by factors like industry dominance in each neighborhood and commuting distances. A high percentage of Midtown employees reside over 30 miles away, whereas a majority of Upper Manhattan workers live within a two-mile radius.
Subway usage, a core element of NYC’s commuting landscape, saw a sharp decline during the pandemic. Placer.ai’s data indicates a slow but steady recovery, as visits to Penn Station and Grand Central Station originating from workplaces are approaching 2019 levels, with certain weekdays seeing even higher traffic in 2023 compared to 2019.
Manhattan’s office recovery doesn’t just impact employers and employees; it has broader implications on migration trends, local governments, real estate, and businesses. As New York City continues adjusting to a hybrid work era, understanding employee patterns on both granular and broader scales may become imperative for investors.
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Image and article originally from www.benzinga.com. Read the original article here.