According to a paper by Gupta, Mittal and Van Nieuwerburgh, the pandemic has had large effects on both current and expected future cash flows for office buildings. Revaluing the stock of New York City commercial office buildings and taking into account pandemic-induced cash flow and discount rate effects, the paper finds a 32.95 percent decline in office values between the end of 2019 and the end of 2020 and a 28 percent decline in the longer-run, the latter representing a $500 billion value destruction.

Last Updated on June 19, 2022 by Ramin Seddiq