Because of its role as the nation’s capital, Washington relies on government officials for its economic success.
Many have chosen to stay at home, perhaps forever, leaving huge federal offices empty and cities in trouble
From restaurants that house federal lobbyists to world-class cultural centers, the city’s fortunes have long been tied to the government workers who run state institutions. While many federal employees are happy to work from home a devastating combination of high-interest rates and tightening bank lending, has also hit the city’s commercial real estate sector and the impact is severe. The federal government has owned nearly a quarter of downtown commercial real estate, historically the city’s “economic powerhouse.”
Continued remote work following the COVID-19 pandemic has resulted in lower office occupancy rates and record vacancy rates in downtown retail
The city is expected to lose nearly $500 million in revenue over the next three years due to “reduced property tax revenues from large office buildings due to continued remote and hybrid work.” According to estimates from the office of Washington Chief Financial Officer Glen Lee. The city’s newly-elected Democrat Mayor Muriel Bowser will take “decisive action” to put federal workers back to their seats or make office space currently occupied by the government available to other businesses. But many federal employees argue that telecommuting offers an opportunity to help the communities where they live.