“No one is buying or leasing office space right now.”
“Office space is in less demand due to COVID-19.”
These are common opinions about the office sector as a result of the pandemic. These are also some of the biggest misconceptions when it comes to this asset class. There is no doubt that the retail and restaurant sectors have been hit hard due to the Stay-At-Home orders and mandatory business closures.
While some sectors are sluggish, the office sector is making a strong comeback in 2021 with sales and leasing activity on the rise. Employers occupying spaces with large square footage aim to downsize and eliminate overhead, while providing their employees the option to work from home or come to the office. This approach is known as a “blended environment.” As the blended environment has become more preferred amongst the workforce across the country, the demand for more collaborative and flexible workspace has increased.
According to insight by CoStar, “higher quality office properties should continue to gain market share, while less-expensive, lower-quality properties lose out.”
These would be merely claims if there was no evidence to back them. Sage Real Estate’s most recent closing is the perfect example.
Juan Huizar and Caleb Baldwin of Sage Real Estate were able to successfully broker the entire 2nd floor of 207 East Broadway Avenue, better known as the historic Insurance Exchange Building. This art-deco property is located directly above The Promenade and is a focal point in the heart of downtown.
The Buyer, a law firm, was looking to reduce its square footage while taking advantage of favorable SBA-financing. The accessibility of SBA-financing has caused a surge in the amount of smaller office tenants seeking to purchase and own their space.
What made this specific property attractive to the Buyer was the modern finishes, countless amenities, and walkability to many Downtown Long Beach attractions. The space contained the perfect harmony of gorgeous wood paneling, exposed brick, and sunlight, giving the space a modern and high-quality feel that employees desire.
The property traded at $1,450,000 (97% of asking price). Sage Real Estate was pleased to represent the Seller on this transaction. John Lindberg of RE/MAX represented the Buyer.