New York City businesses’ back-to-office plans face lingering COVID headwinds

Efforts by financial firms and others to bring workers back to Manhattan offices more than two years after the start of the coronavirus pandemic face lingering headwinds, the consultants said, with travelers still concerned about the COVID-19 and security.

New York has lagged behind other major markets in the percentage of employees who regularly work in the office, in part due to high rates of public transportation use and COVID concerns, said David Lewis, chief executive of the consultancy. of human resources OperationsInc, which works with several companies in the financial sector

Overall, New York City had an office occupancy rate of 38.8% in the week ending May 11, below the 43.4% occupancy rate nationally, according to Kastle data. , which sells access cards for offices.

The security of the subway system was the biggest obstacle to returning to the office, with 94% of respondents saying not enough is being done to address the problem, according to a survey by the Partnership for New York City.

“Businesses will need to address public transportation fears if they want to have any hope of getting people back to the office,” Lewis said.

There have been a number of recent attacks including a mass shooting at a Sunset Park, Brooklyn subway station in April and the death of Michelle Go, a 40-year-old woman who died in January after being pushed in front of an approaching train. at the Times Square station. On Sunday, Daniel Enriquez, who had worked for Goldman Sachs’ GS.N Global Investment Research since 2013, was killed while riding a Q train bound for Manhattan in an apparently random attack.

About 80% of office workers in Manhattan relied on the subway to get to work before the coronavirus pandemic began, said Kathryn Wylde, executive director of the nonprofit Partnership for New York City.

“The rise in crime on the subway over the last two years has clearly put people off about their safety, and whether it’s an excuse or a reality, people are less willing to go back to the office unless the situation is addressed. of crime in the subway. she said.

Criminal complaints in the subway system in April increased 24.7% compared to the previous year, to a total of 389, according to data from the New York City Police Department. However, overall criminal complaints on the subway system were down 15% in 2021 compared to pre-pandemic levels in 2019, although ridership has dropped significantly during that time.

Growing concerns about public safety may prompt more companies to pay for taxis or private rides for employees, said Melissa Swift, US transformation lead at Mercer. “It didn’t used to be an employer’s job to get you to the office, but one consequence of the COVID period is that once work and life mix, you can’t separate them again,” she said.

Mayor Eric Adams, a former police captain who took office in January, increased the number of police officers in the Traffic Bureau to 3,500, surpassing the 3,250 officers sent to the system last summer in an increase from his predecessor. Adams said he would temporarily double that number after the Sunset Park shooting.

Concerns about public transportation safety will likely add to existing pressures in the New York City office market, said Scott Crowe of real estate investment firm CenterSquare Investment Management in Philadelphia, who expects market values of office buildings in Manhattan fall by 10%. or more.

“Employers are under tremendous pressure from employees to offer as much flexibility as possible when it comes to work location,” he said. “If there are safety-related issues now, that is another headwind for employers to try to get people back to work.”

(Reporting by David Randall; Editing by Megan Davies and Lisa Shumaker)

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COVID-19 New York

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