Office Space Demand Shift
Date Published
The rise of hybrid and remote work has fundamentally changed how businesses approach office space. In this Office Space Demand Shift blog, we explore how these flexible work models are reshaping the commercial real estate market in 2025.
The New Normal: Hybrid and Remote Work
Remote work is now a mainstream option, with over 32.6 million Americans—22% of the workforce—working remotely in 2025. Hybrid arrangements are even more popular, as 83% of workers globally prefer a mix of in-office and remote days. This shift has led companies to reevaluate their office needs, with nearly half of organizations reducing their real estate footprint in recent years.
Office Downsizing and Redesign
To adapt to these trends, many companies—especially in business services and finance—have downsized their office space to cut costs. At the same time, three-quarters of employers are considering redesigning their offices to make them more flexible and appealing. Modern offices now focus on adaptable layouts and amenities that support collaboration, productivity, and employee well-being.
Changing Demand and Vacancy Rates
Although remote work has reduced the need for traditional office space, the national market is showing signs of stabilization. In 2025, the nationwide office vacancy rate is holding steady at 11.8%, and net absorption remains positive as some employers increase in-office requirements. However, the long-term structural shift caused by remote and hybrid work is already reflected in current leasing activity.
What Employers and Employees Want
Employers are balancing cost savings with the need to foster workplace culture and teamwork. While 48% of companies now require some in-office time, employees value flexibility and lower commuting costs. The ideal future office supports a variety of work styles and offers spaces that make coming to the office worthwhile.
Conclusion
As organizations seek the right balance between flexibility, culture, and cost, the commercial real estate market will keep evolving. For expert guidance on navigating these changes, trust the Onward Real Estate Team to help you make informed decisions.