The U.S. office building market is undergoing a massive bargain sale. As the market slump persists, building owners are selling properties at discounts exceeding 90%, while vacant office buildings are being actively redeveloped into urban farms and residential facilities.
The office market began to falter during the pandemic. As remote work became established, vacancies surged, and building owners and creditors endured massive losses while hoping for a rebound. Owners injected additional capital, and lenders extended loans while waiting for an economic recovery.
However, even after the pandemic ended, hybrid work became entrenched and interest rates rose, causing loan burdens to surge. With maintenance costs such as taxes and utilities continuing even without tenants, more owners are reluctantly pursuing sales while absorbing losses.
An office building in Chicago that sold for $68.1 million (approximately 100.5 billion won) a decade ago recently traded for $4 million (approximately 5.9 billion won). The Denver Energy Center, a two-building complex that sold for $176 million (approximately 260 billion won) in 2013, recently changed hands for $5.3 million (approximately 7.8 billion won). Even the General Services Administration (GSA) sold a 940,000-square-foot building last month for $24 million (approximately 35.4 billion won) — less than one-tenth of its price from several years ago.
