Office Market, Telecommuting and the Post-Pandemic Era

Since it is expected that when the pandemic is overcome, 4 out of 5 companies will opt for hybrid working modalities, which contemplate face-to-face and distance activities, the offer of offices will have to be adjusted to the new market conditions.

Tuesday, January 19, 2021

Before the pandemic, it was estimated that only 30% of companies were betting on modalities that included face-to-face and telecommuting activities. However, due to the changes in people's habits caused by the covid-19 outbreak, it is estimated that in the post-pandemic era 80% of companies will apply hybrid forms of work.

Learn about the "Feasibility studies of real estate projects" that we carried out at CentralAmericaData.

Daniel Alvarez, senior vice president of Cushman & Wakefield AB Advisory, told that because most labor markets are in a transition phase from face-to-face work to telecommuting, there is a substantial reduction in office density.

For example, in the Costa Rican market, office availability has now climbed to 15.5%, which is above the 10% that is considered healthy.

See "Central America: Is the Real Estate Market Moving?"

According to a study carried out by Cushman & Wakefield AB Advisory, the trends in office work will be the following in the coming years:

- "The flexibility of work spaces will be key. The return to the offices will be through staggered schedules, so as to ensure social distancing.
-The expectations of 59% of the employees is that in a post-pandemic era, they will be able to fulfill their workday through teleworking at least 60% of the time.

In the next few years, the properties dedicated exclusively to the rental of office space will have to adjust their offer to the needs of their tenants, who will no longer spend 100% of their working day in the properties, since it is expected that they will use them eventually.

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More on this topic

Office Market: Vacancy Rate Rising

June 2021

Last year in Costa Rica, the office market vacancy rate doubled from 7.45% in the first quarter of 2020 to 15.15% in the same period of 2021, a rise that was largely induced by the implementation of telecommuting.

In this context of health crisis that was triggered by the spread of Covid-19 several companies changed their work dynamics, with migration to telecommuting being one of the most important changes.

Office Rental: Market Correction

March 2021

The oversupply of office space and changes in the dynamics and ways of working of companies have led the office rental market to a corrective or adjustment phase, which is mainly evidenced by the downward pressure on rental prices.

At the beginning of 2021, CentralAmericaData expected that in the coming years, 4 out of 5 companies will bet on hybrid work modalities, which include face-to-face and remote activities. This phenomenon will force office supply to adjust to the new market conditions.

Change in Lifestyle vs. Rental Prices

May 2020

It is estimated that the increase in online sales and the greater trend towards telecommuting will result in a lower demand for commercial premises and offices, exerting downward pressure on the price level of rents in the long term.

The quarantines decreed in the Central American countries because of the covid-19 outbreak, have caused a transformation in the operations of the companies, in the ways of working and in the models of business and sales.

Costa Rica: Good Figures for the Office Market

October 2017

The availability rate for the real estate segment of rental offices is 10%, and the average price per square meter is around $19.

The dynamism of the activities linked to the services sector is the main driver of the growth in the office market segment in the Greater Metropolitan Area.

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