How many Las Vegas workers have returned to the office?

Las Vegas workers have returned to the office at a much higher rate than the national average, according to new statistics from Avison Young.

The vast majority of the valley’s office workers have returned, reaching 80.5 percent of pre-pandemic levels compared to 2019, according to the study, which utilized location-based technology. The national average is 61.9 percent. Las Vegas ranked second in the nation from 2019 to July of this year, beaten only by New York City’s outer boroughs.

Scott Donaghe, a principal at Avison Young’s Las Vegas office, said the local market has returned to offices largely because of two things.

“First, as a younger city, Las Vegas lacks the same volume of older legacy real estate built over multiple cycles which can put a drain on absorption,” he said. “Save a few marquee office projects, the region has been particularly under-built since 2008. Additionally, the office market continues to benefit from outflows from California due to a variety of reasons including a lower cost of living for residents, a lower cost of doing business, and an overall more business-friendly state.”

The valley’s biggest driver for month-to-month job growth to the end of July is in the biotech, life sciences, pharma and the health care industry, followed by banking, finance, real estate and tech. The biggest growing office sectors in the country are engineering, architecture and construction.

Office space vacancy has been on a steady climb in the valley since the second quarter of last year (just above 11 percent) and as of the end of the second quarter of 2024 sits at 12 percent, according to the report. Asking rents have also been on a steady rise and now sit at $2.65 cents per square foot, compared to $2.50 cents during the second quarter of 2023.

A glut of new office space came onto the market in the second quarter of this year (188 million square feet) after zero was delivered in the previous two quarters. But construction of office space has dropped off since the first quarter of 2024 (262 million square feet) down to 98 million in the last quarter, according to the Colliers second-quarter office market report for Southern Nevada.

Colliers second quarter report on the national office space market said the industry has had a rough go since 2020 however there may be a slowly growing sense of “cautious optimism.”

The U.S. office market continued to contend with the post-COVID slowdown that started in 2020,” read the report. “Metrics remained soft, new construction starts stopped in most markets, and concession packages were at an all-time high. While there is cautious optimism that the worst may be in the past, market fundamentals remain firmly in the tenant’s favor.”

Las Vegas’ most famous office park, The Hughes Center, went into court-ordered receivership after its owner defaulted on its loan in July. New York-based investment firm Blackstone stopped making payments on a $325 million loan for the 1.4 million square foot complex last year.

Contact Patrick Blennerhassett at pblennerhassett@reviewjournal.com.