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Despite office vacancy falling in most major cities, most landlords are still watching their margins shrink a half-decade after tenants embraced remote work.
Median total operating expense growth has exceeded revenue every year from 2021 through 2025, according to a Trepp ***** ysis of office properties backing CMBS loans.
Operating expenses have increased 2.7% annually, compared with a 1.3% growth rate for revenues. Net operating income has been squeezed to just a 0.2% uptick annually as a result.
Overall, the implied five-year growth rate is 14.3% for operating expenses and 6.7% for revenues. NOI was up just 1% during the period, according to Trepp's model.
#year #expenses
Despite office vacancy falling in most major cities, most landlords are still watching their margins shrink a half-decade after tenants embraced remote work.
Median total operating expense growth has exceeded revenue every year from 2021 through 2025, according to a Trepp ***** ysis of office properties backing CMBS loans.
Operating expenses have increased 2.7% annually, compared with a 1.3% growth rate for revenues. Net operating income has been squeezed to just a 0.2% uptick annually as a result.
Overall, the implied five-year growth rate is 14.3% for operating expenses and 6.7% for revenues. NOI was up just 1% during the period, according to Trepp's model.
#year #expenses
3 hours ago
