In response to a slow pace of employees returning to offices and an increase in investors predicting further declines, share prices for many major office real estate firms have retreated close to their all-time lows.
In the first week of May, office occupancy in the 10 most populous U.S. cities was only half of the pre-pandemic levels, according to data from Kastle Systems, which monitors key card swipes in 2,800 buildings across the country. Since November 2022, the trend in the office occupancy rate has been essentially unchanged, indicating that we have reached a “new normal” for office occupancy, at least for the time being.
Chart 1: SL Green Realty Corporation Fell Below Its IPO Levels In 1999
Shares of SL Green Realty Corp (NYSE: SLG), the largest office landlord in Manhattan, have lost a third of their value since the start of the year, falling to a level lower than when the company went public in 1997.
The short interest has increased to 28% of outstanding shares, surpassing the 25.7% …
