The office market is one of many sectors in the UK which is currently suffering.  Problems started with Covid, around April 2020, and the resurgence around mid-2021 was short lived.

A lot of people haven’t returned to the office in the way some said they would.  There are many reasons for this and a few common themes.  People dislike the time it takes to travel to and from the office, the expense and the inconvenience/stress.  As a result of this, some companies have closed their offices whilst others have downsized.

It is very common today to walk through towns and cities and see vacant offices.  There are more offices for sale today then there has been over the past decade.  Further, the situation is getting worse.  Those who own offices have seen their rent disappear and are now seeing values fall sharply.  It is very hard today to find tenants for vacant offices.  If you are lucky enough to find one, they will negotiate very hard on the rent.

It’s not just the private sector office market which is suffering.  The public sector has also seen a wave of office closures and will see a lot more in the near future.  The government is cutting costs and closing offices used for Job centres, DWP, HMRC and many more.

The solution to this problem isn’t selling to developers as they too are suffering.  Those who have offices for sale who need to sell quickly must reduce the price.  Markets don’t cease to exist but the volume of transactions and prices change.  There are still buyers for offices but they are being very cautious and only buying if the price is right.

Will the office market ever recover?  This is very subjective but the short answer is yes.  However, it will never return to the way it was as working from home and flexi working is here to stay.