Sheena Gohil
Bob Shanahan
Dougal Jeppe
Kai Shane
If 2024 was the year companies gained clarity on their long-term office needs, 2025 is shaping up to be the year they act on it—bringing workers back to the office full time, committing to hybrid work, and recalibrating their office footprints accordingly.
Corporate decision-makers are reassessing their approach to flexible work. Stricter in-office mandates, many of which take effect in 2025, signal a shifting tide in workplace strategy for some larger companies. CEOs are increasingly aligning on the need for in-person collaboration and becoming more vocal about the need for in-person engagement. While the debate over hybrid policies has seemingly settled, the question now shifts to execution: How much space do companies need, what should be done with that space, and how often do they expect employees to use it?
Yet, despite these tightening mandates, office attendance so far remains below pre-pandemic norms and hybrid work remains widespread. While leasing activity is showing some stabilization, a return to 2019 leasing levels is not expected in most markets. However, Manhattan’s office leasing volume of 3.63 MSF in January 2025 was 36% above the ten-year monthly average and even surpassed the average monthly volume in 2024, according to Colliers. Even San Francisco’s leasing activity is signaling the start of a recovery with vacancy decreasing in Q4 2024 for the first time since 2019 after 8.1 MSF was leased in 2024, per Colliers. In Q4 2024, the U.S. office market also posted its first positive net absorption since Q3 2022.
Through 2025, a collection of high-profile companies will be among the first to set the tone for return-to-office policies, with their decisions potentially influencing broader market trends. Adding to this shift, the Trump administration’s renewed push to bring the federal workforce back to the office and phase out remote work could further accelerate office utilization, particularly in Washington D.C., which set a record high in office utilization, according to Kastle Systems data for the final week in January 2025. While this growing momentum could signal a turning point for the office sector, it may also underscore the reality that demand recovery remains gradual and uneven across markets and industries, and companies need to balance the best of remote, hybrid, and in-office work to maintain productivity, job satisfaction, and retention.
Fortune 500 Firms Lead Return to Office Push
Amazon’s push for a full return to office is reshaping its real estate strategy in New York and beyond. With CEO Andy Jassy mandating 350,000 corporate employees be back five days a week starting January 2025, the e-commerce empire has been expanding its office footprint. In Manhattan alone, Amazon occupies swaths of space, including its newly opened Hank office – the former Lord & Taylor building in Midtown – in addition to Five Manhattan West. It will also utilize a recently leased 304,000 square foot WeWork location at 330 W. 34th St. However, not all Amazon employees will be back at their desks just yet – some offices in cities like Atlanta, Dallas, Houston, Nashville, New York, and Phoenix lack the space to accommodate full in-office attendance, delaying the moves by up to four months. In San Francisco, where Amazon has 18 offices, a group of employees submitted a plan to Amazon’s facilities team asking for a new location, stating the company is short by at least 800 desks in the Bay Area. While Amazon’s return to office strategy is still unfolding, its decision to move toward a full-time in-office model could be an early indicator of a larger national trend, with more companies reassessing hybrid policies and bringing employees back to the office in the months ahead.
Adding to this growing momentum for in-office work, JPMorgan Chase, the largest bank in the U.S. and employer of more than 316,000 people worldwide, announced in early January that it is ending remote work. Employees will be required to return to the office five days a week beginning in March 2025. Since April 2023, some 60% of the bank’s employees were already working a full five days a week in the office, as financial services tenants, in particular those with a large presence on Wall Street in Manhattan, largely have higher office utilization rates. Goldman Sachs and Bank of America are also mostly back in the office full-time.
On the first Monday of January, AT&T began implementing its five-day return-to-office plan. However, according to a recent Business Insider article, limited available desks at some offices complicated workers’ returns. At the Dallas-based telecom giant’s offices in Atlanta, employees encountered a lack of open desks, filled parking lots, and a limited number of available elevators.
Other large companies with office-only strategies include Tesla, Walmart, and others we are continuing to track.
However, many still fall into the hybrid model, with three to four days in-office expected. Among these office-first hybrid companies include Apple, Charles Schwab, Netflix, X, Wells Fargo, Google, Microsoft, Meta, Salesforce, and LinkedIn. Some major companies are still offloading unoccupied space despite the push for in-office attendance. The latest example of this was Meta’s announcement that it would be shedding some 2.0 MSF of empty Bay area office space. There are also some large firms holding out on moving back into the office, maintaining remote-first options for their employees. These companies include Dropbox, Stripe, Yelp, Coinbase, Airbnb, Autodesk, and Zillow.
Brian Elliott’s recent Substack article, “Your CEO Wants to RTO,” provides perspective and notes that some major companies aren’t following the full-time return trend, despite the flurry of headlines. Citi, Deloitte, EY, PwC, and KPMG are all sticking with hybrid approaches and offering this flexibility to retain their most talented employees.
What does the data tell us?
The data on office utilization shows building momentum as we enter 2025. However, overall foot traffic in offices remains well below pre-pandemic levels. We will dive into both Placer.ai and Kastle Systems office utilization data, and other relevant data points, to provide a comprehensive overview of where we are today.
Throughout 2024, office visits were at 65.7% of 2019 levels and 10.0% above 2023 numbers, according to Placer.ai. Nationwide office visits in December 2024 were 60.8% of December 2019 levels, compared to 57.2% in December 2023. Notably, in July 2024, office visits were 72.2% of 2019 levels, an increase from 62.0% in 2023. Atlanta and Boston led the way in year-over-year office recovery in 2024, increasing 13.7% and 12.1%, followed by Washington, DC at 10.6% and San Francisco at 10.4%.
Kastle Systems’ Back to Work Barometer showed a similar upward trajectory in office utilization in early 2025. The weekly average office utilization of the top 10 U.S. markets hit a new post-pandemic high in the last week of January 2025 at 54.2%, up 380 basis points since January 2023. Every tracked city recorded an increase, with San Jose, Washington DC, and Philadelphia hitting record highs. Peak day office utilization of 63.4% on Tuesday, January 28, rose 18 basis points week-over-week. Houston and Austin experienced the greatest increases in peak day utilization of more than 70 basis points to 74.8% and more than 50 basis points to 68.3%, respectively. Chicago was up nearly 28 basis points to 70.4%, and Washington, DC, increased more than 10 basis points to 61.7%.
Return to office trends vary by market and employment concentration. For example, tech markets with above-average tech employment concentrations typically have higher vacancy rates and lower office utilization figures. In contrast, markets with a higher concentration of financial and professional services are higher. According to Colliers Workplace Advisory’s analysis of Flex Index data, tech companies make up approximately 70% of the fully remote workforce. San Francisco, with a tech employment concentration of 3.16 (more than three times the national average), has a 30.2% office market vacancy rate and 45% (Kastle) to 48% (Placer.ai) office utilization. On the other end of the spectrum, Miami, with a 0.77 tech employment concentration, has a 9.1% office vacancy and 79.1% utilization. Analyzing the top 14 office markets in the country, the numbers illustrate this correlation. Of the six tech-heavy markets, the average vacancy rate was 21.9% and utilization was 52.7%, while the eight diversified office markets had a vacancy rate 240 basis points lower (19.5%) and utilization 720 basis points higher (59.9%).
One more trend to consider is the growing gap between office-using employment growth and office space occupied nationwide in the last five years. Pre-2020, the growth of employees at companies using office space would typically result in higher leasing activity in the office sector. However, since 2020, this has not been the case. Despite continued occupancy losses across the U.S. office market since 2020, office tenants have continued to expand their headcounts. By the end of 2024, office-using employment increased 5.3% compared to year-end 2019. Meanwhile, occupied office space across the U.S. declined 4.3% over that same five-year time frame. The adoption of hybrid work can explain the lack of office leasing activity given this discrepancy, but, with return-to-office measures being implemented by large companies this year, it is possible this could start to equate to more office tenant demand.
To gain additional insight, we surveyed Tenant Advisory Council members about the return-to-office (RTO) trends they’re observing among the companies they advise. Forty percent of respondents stated they saw requirements solely related to RTO policies. In addition, 80% of respondents said the companies they work with have changed their RTO policies for 2025 by 50% or less, with only 20% saying more than 50% have changed policies. Finally, 45% of respondents replied that companies are taking less space, compared to just 15% taking more space.
A New Value Proposition
The role of the office has evolved—it’s no longer just about where work gets done, but how it enhances collaboration, engagement, and business outcomes. We spoke with Kai Shane, Senior Director at Colliers Workplace Advisory, to explore the intricacies of the return-to-office movement and the evolving future of work. She mentioned that while the recent headlines of major corporations implementing full return-to-office measures have been garnering most of the attention on the subject, “structured hybrid” is now the dominant approach for most companies. The shift to hybrid work is here to stay, and companies must rethink their office strategies to drive intentional interactions, build trust, and support employee growth. The most successful organizations aren’t mandating presence for presence’s sake—they’re designing spaces that foster productivity, innovation, and connection. The new value proposition for office space is clear: it’s about creating purpose-driven environments that elevate both business performance and employee experience. Organizations embracing flexible, outcome-driven models will be better positioned to navigate not just return to office, but larger workforce transformations like artificial intelligence integration.
Yet, navigating these complex decisions—from rethinking space needs to ensuring workplace strategies align with business goals—requires expert guidance. In a time of shifting office dynamics, having a knowledgeable advisor on your side is crucial. The right advisor brings market expertise, data-driven insights, and an understanding of evolving workplace trends, helping companies make informed, strategic real estate decisions that support both their workforce and bottom line.
The Colliers Tenant Advisory Council (TAC) is a specialized group of top advisors dedicated to guiding corporate occupiers through the evolving commercial real estate landscape. Comprised of about 100 members across 50 cities, TAC focuses on best practices, collaboration, and resource sharing to deliver exceptional tenant representation. As businesses face uncertainty, change, and complexity, TAC leverages deep local market insights and strategic expertise to help clients navigate challenges and develop agile real estate strategies that align with their core business goals.
Presented by Colliers Tenant Advisory Council. Click the links below to view our previous posts:
Chris Zlocki
Aaron Jodka
Workplace Advisory