With the change in the way and location people are working, how do you see New Orleans’ Downtown District changing in the coming years?
Rich Stone, CCIM
Senior Sales and Leasing Associate
Latter & Blum
Short term, look for softness in office demand, as office users are still trying to digest the long-term economic impact of COVID-19. On the bright side, our downtown office occupancy was mostly healthy prior to the lockdowns — helped by the fact that no Class A office building construction has occurred here since 1989. Long term, office demand is not going away, rather I expect that many users will rethink how their offices can be transformed to maximize productivity.
Snappy Jacobs, CCIM Real Estate Management, LLC
The lasting effects of remote work will be smaller office footprints with shorter,more flexible lease terms and relocations from Downtown office towers to smaller buildings, such as on Magazine Street and in Metairie, which are closer to many decision-makers’ homes, provide easier and (perceived) safer access, and lessen the threat of being closed during outbreaks. We will also see an opportunity to convert Downtown properties to live/work for small businesses.
Michael J. Siegel, SIOR
Over the past three decades, the New Orleans CBD has evolved from an office-centric, traditional business district to a true 24/7, live/work/play downtown, a transition that many other cities would like to emulate. I believe this evolution will continue, not because of the existing popularity of remote work, but because of the environment that now exists in Downtown New Orleans. I believe that the future of the CBD is bright due to the aforementioned evolution that has taken place and that the CBD embodies all of the assets that a contemporary workforce desires, most notably affordable office space, easy access and a vibrant quality of life.
Blaine M. Gahagan
Managing Partner and Realtor
HGI Realty & Facility Management
We are hearing from our clients that office space vacancy will increase as leases come up for renewal. The days of a 40-hour employee physically clocking in at the office are gone and this is probably going to benefit a short-term rental or flex lease type office landlord. Short-term leasing — by the day, week or month — currently represents a small part of the office lease market, but I see the concept growing over the next few years.
The Domain Companies
We own and manage multiple Downtown residential developments and a coworking space, so we’ve seen the effects of remote work from many angles. Amenities like outdoor spaces with socially distanced seating configurations and charging stations; fast, free Wi-Fi and conference rooms and media lounges won’t be optional for future Downtown developments. I also expect the coworking option to continue to grow along with comfort levels and the popularity of remote work.
Richard E. Juge, CCIM, SIOR
RE/MAX Commercial Brokers
The expectation is that larger companies will continue to embrace flexibility and remote work, and that the return to a full in-office work week will take two to four years. This will result in less office demand in the short term. On the positive side, New Orleans’ CBD has a higher concentration of smaller/local companies, which are expected to have a quicker return to in-office working. All told, the pressure will be on the landlords while the tenants will see better deals and more options.
VP of Communications and Business Development
Ryan Gootee General Contractors
We have seen a significant decrease in tenant improvement projects in Downtown office buildings, which is directly linked to more short-term leases being signed. Commercial real estate will have to adapt by offering more competitive incentives and reengineering the workspace to meet the expectations of a post-pandemic Downtown workforce.