Since the COVID-19 pandemic forced businesses to close their doors and permit employees to work from home, San Diego office vacancies are down to nearly 19%. This is the highest recorded vacancy rate since 1999, and it’s expected to continue to grow through 2021. Despite high office vacancies, developer LeBeau Realty & Associates is currently building a second six-story office building as part of an office complex that already includes a vacant 20-story office building.
Twenty by Six, the new building being constructed on B Street, will be equipped with balconies, opening windows, and an outdoor courtyard. The building also includes moveable walls that the developers hope will appeal to potential tenants as they try to design what a post-pandemic office may look like.
The developers had not intended construction during the global pandemic. Similarly to many redevelopment projects, the process of getting approvals and financing the project took nearly a decade as it was debated and considered across a number of finance partners and government agencies. With anticipated completion right around the corner, many wonder if the newly constructed building will be put to use.
Experts predict, across the board, that working in an office is never going to be the same. The pandemic has proven to some employers that they don’t need office space, and are able to complete their necessary tasks while their employees work from home. Downtown San Diego is experiencing a surge of new residents taking advantage of the downtown San Diego real estate market. With more people working from home, people are deciding to make their homes more enjoyable places to live. Telework isn’t a new concept, but it’s being adopted like one.
The project’s developers are not concerned. They anticipate higher vacancy rates, but believe wholeheartedly that the work-from-home phenomenon will not last very long. They argue that the new office building should appeal to tech companies because of all the open space with the indoor and outdoor access. However, they explained that offers are already being considered by a law firm, one tech firm, an engineering firm, and a bank interested in moving into the newly erected building.