CONTACT US
Share: Share on Facebook Share on Twitter Share on LinkedIn I recommend visiting cushmanwakefield.com to read:%0A%0A {0} %0A%0A {1}
obsolescence-mobile-banner obsolescence-hero-banner-v2

Insights

Obsolescence Equals Opportunity

get the Report

Much has been written about the potential death of the office, with justifiable concern that some office properties may never again be fit for their original purpose. Running counter to the doomsday narrative is Cushman & Wakefield’s new publication, Obsolescence Equals Opportunity. In it, we offer a perspective focused on the upside potential for owners who are able to meet the market’s call to action. 
This study breaks new ground by quantifying the U.S. office market for its potential, with current and anticipated supply juxtaposed against trends in demand. We find an unprecedented imbalance in supply and demand which, by the end of the decade, will result in a surplus of 330 million square feet of vacant office space that hasn’t kept pace with demands to support hybrid working and efficiency/ESG priorities.  The imbalance in demand is further accentuated by a growing quality gap: demand for high-quality office product that can accommodate hybrid strategies and provide a strong in-person experience is dramatically higher, while demand for product that cannot meet modern-era tenant requirements is dramatically lower. 

Shifting Opportunities 

While the bulk of office space in the U.S. needs to consider its competitive positioning, not all is lost for those facing headwinds. Owners and investors focused on proactively addressing such challenges will be able to recover value and generate returns. By exploring opportunities to reposition or repurpose, no shortage of opportunity exists with the right partners for strategy, funding and execution. Through case studies and deep dives into the sectors such as life sciences, healthcare and multifamily, Obsolescence Equals Opportunity explores alternatives for repositioning and repurposing. 

Repositioning  

Repositioning strategies are among the least costly and most efficient strategies for bringing an obsolete office property up the value and relevance curve. However, it does require experience and insight to ensure any investments are the right size and in the right areas to meet tenant demand in the local market.  

Repurposing  

Depending on the market, submarket or property, an asset may not be a strong candidate for repositioning strategies, either due to the competitive landscape or due to the building’s physical characteristics. Owners of assets that are candidates for repurposing should thoroughly estimate project costs, demand-side potential and exit value assumptions in the next part of the evaluation phase. 

Authors

Abby-Corbett-Headshot
Abby Corbett

Senior Economist, Head of Investor Insights
Milwaukee, United States


Download VCard

Kevin Thorpe Washington DC Chief Economist
Kevin Thorpe

Chief Economist
Washington, United States


Download VCard

David C Smith (image)
David Smith

Head of Americas Insights, Global Research
Atlanta, United States


Download VCard

Related Projects

China Generation Z Workplace Report 2025
Research • Economy

New Kids On The Block: Generation Z And The Changing Office Workplace On The Chinese Mainland

This new Greater China report analyses the evolving needs of the “new kids on the block,” Generation Z, on the Chinese mainland and their implications for the office workplace in the region. Survey data included in the report reveals the Chinese Generation Z's office worker priorities of flexibility, collaboration, and sustainability. 
 
 
Shaun Brodie • 24/04/2025
London Moves_Web Card Small 750x456px.png
Research • Workplace

London Moves

London Moves 2025 is Cushman and Wakefield's detailed analysis of the who, what, where and why of office relocations across the Capital.
Kiran Patel • 24/04/2025
coworking
Research

Coworking and Serviced Offices

Explore the dynamics of the flexible offices in the Czech Republic.
Kamila Breen • 16/04/2025
Fit Out Cost Guide 2025_Web Card.jpg
Research • Workplace

Office Fit Out Cost Guide

Explore our Office Fit Out Cost Guide 2025 to budget and plan your workspace transformation in the U.S. effectively. Start optimizing your office today.
31/03/2025
China Think In Report 2024
Research • Economy

Real Estate Asset Management Optimization On The Chinese Mainland: Adapting To A Transitioning Market

Our Think-In report for 2024 explores the importance of real estate asset management optimization on the Chinese mainland during a period of market change. Specifically, the report focuses on three major commercial property sectors, namely office, retail, and industrial; and centers on adapting to shifting market dynamics, a new era of consumption, and game-changing smart technology.
 
Shaun Brodie • 11/12/2024
Hong Kong Year End Market Report Q4 2024
Research • Economy

Hong Kong Property Markets — 2024 Review And 2025 Outlook

Hong Kong office market net absorption improved in 2024 to reach 1 million sq ft. Residential market sentiment strengthened with greater demand for rental housing assets, and with the government expanding the non-local student ratio, student accommodation has become a focus in the city’s capital market. In the retail market, active new leasing activity in prime streets has reduced vacancy rates across core districts.  
 
Rosanna Tang • 09/12/2024
obsolescence-case-study-1
The Vacant Behemoth

Total Budget $20 Million

  • Transformed quality of space and amenities to attract tenants
  • Commitment to quality and detail was key throughout execution
  • Common area amenities and alternative work areas were  appealing to tenants
obsolescence-case-study-4
Office Campus to Industrial​

1984-vintage office asset purchased for $16 million ($55/sf) later sold for $128 million ($441/sf)

  • Extensive renovation transformed the property from an office for Bank of America to a distribution warehouse
  • Fully occupied by Amazon through 2036 with 2% escalations on triple net basis
obsolescence-case-study-3
High-Rise Mixed-Use

The 1.4 msf office building sold for loan loss of $107 million, purchased for $4.5 million in April 2022.

  • New plan to convert the tower into apartments and hotel
  • Adding other amenities while also keeping a portion of the tower as office space
  • Workplace strategy increased marketability of multi-tenant floors
obsolescence-case-study-2
1980s, 3-building​ Full-Repositioning Play

Total Budget $45 Million

  • Total renovation and repositioning of 3 buildings
  • Focused on amenitization and activation of space
  • Beyond renovation, created a significant tenant experience/community management program
obsolescence-case-study-5
High-Rise Office to​ Partial-Clinical Office

Total Budget $10 million, Chicago’s iconic Hancock Tower

  • Convert 4 floors to healthcare uses while reconfiguring components of the asset to accommodate a surgery center and other clinical uses
  • Now in lease-up witnessing strong interest

​Related Services

Distressed Asset Solutions
Solutions for the challenges of real estate uncertainty
Learn More
Capital Markets

We make more deals by accessing more investors, creating more connections and providing exclusive, local insights. We relentlessly make opportunities for our clients. Every day. All over the world.

Learn More
Asset Services
Managing office, retail or industrial property to reduce costs, mitigate risk, and enhance value—while providing superior tenant service.
Learn More
Project & Development Services
Aligning with client culture and goals to shape the built environment together.
Learn More
Agency Leasing
Driving optimized leasing investments.
Learn More
Valuation & Advisory
Cushman & Wakefield’s Valuation & Advisory (V&A) practice is comprised of 500+ professionals across the Americas who provide clients with accurate, reliable valuations that guide intelligent debt and equity decisions in real-time.
Learn More

​Related Insights

China Generation Z Workplace Report 2025
Research • Economy

New Kids On The Block: Generation Z And The Changing Office Workplace On The Chinese Mainland

This new Greater China report analyses the evolving needs of the “new kids on the block,” Generation Z, on the Chinese mainland and their implications for the office workplace in the region. Survey data included in the report reveals the Chinese Generation Z's office worker priorities of flexibility, collaboration, and sustainability. 
 
 
Shaun Brodie • 24/04/2025
London Moves_Web Card Small 750x456px.png
Research • Workplace

London Moves

London Moves 2025 is Cushman and Wakefield's detailed analysis of the who, what, where and why of office relocations across the Capital.
Kiran Patel • 24/04/2025
US Office MarketBeat (image)
MarketBeat

U.S. Office Reports

Access the latest quarter commercial real estate results for the office sector nationally. MarketBeat reports analyze quarterly market activity including supply, demand and pricing trends.
David Smith • 14/04/2025
critical-questions-2025-webcard.jpg
Research • Economy

​​10 Critical Questions for 2025

CRE is set for a transformative 2025. From potential tariffs at U.S. ports to rising demand for multifamily properties, each sector faces unique challenges and opportunities.
Kevin Thorpe • 02/01/2025
China Think In Report 2024
Research • Economy

Real Estate Asset Management Optimization On The Chinese Mainland: Adapting To A Transitioning Market

Our Think-In report for 2024 explores the importance of real estate asset management optimization on the Chinese mainland during a period of market change. Specifically, the report focuses on three major commercial property sectors, namely office, retail, and industrial; and centers on adapting to shifting market dynamics, a new era of consumption, and game-changing smart technology.
 
Shaun Brodie • 11/12/2024
Flexible Office
Research • Workplace

Flexible Office is a Powerful Part of Your Workplace Strategy

Explore new data about the role of flex space in creating idea workplace ecosystems.
Bryan Berthold • 15/09/2022

Ready to talk?

We look forward to connecting with you.
With your permission we and our partners would like to use cookies in order to access and record information and process personal data, such as unique identifiers and standard information sent by a device to ensure our website performs as expected, to develop and improve our products, and for advertising and insight purposes.

Alternatively click on More Options and select your preferences before providing or refusing consent. Some processing of your personal data may not require your consent, but you have a right to object to such processing.

You can change your preferences at any time by returning to this site or clicking on Privacy & Cookies.
MORE OPTIONS
AGREE AND CLOSE
These cookies ensure that our website performs as expected,for example website traffic load is balanced across our servers to prevent our website from crashing during particularly high usage.
These cookies allow our website to remember choices you make (such as your user name, language or the region you are in) and provide enhanced features. These cookies do not gather any information about you that could be used for advertising or remember where you have been on the internet.
These cookies allow us to work with our marketing partners to understand which ads or links you have clicked on before arriving on our website or to help us make our advertising more relevant to you.
Agree All
Reject All
SAVE SETTINGS