Work-from-office 4 to 5 days a week: Salesforce to employees
Software giant Salesforce has issued an internal memo, directing most of its employees to return to their offices by October 1, according to the San Francisco Standard. Select employees in sales, workplace services, data center engineering, and onsite support technicians will have to come into the office, four to five days a week. Other departments must report to offices three days every week.
Salesforce's hybrid work model continues
When asked about the New York office or the October 1 deadline, a Salesforce spokesperson did not provide specific answers. They stated, "Salesforce has always been a hybrid work company. Our guidelines focus on in-person connection, while also recognizing the value of working away from the office." This move aligns with other companies welcoming their staff back to the office.
Decision contrasts CEO's previous statement
The company's decision seems to subtly retract CEO Marc Benioff's 2022 statement that "office mandates are never going to work." This comes as New York City metro area office visitation in May and June, reached 83.9% and 85% of 2019 levels respectively, according to Placer.ai. The area around Salesforce's largest tenancy at 1095 Sixth Avenue at West 42nd Street is already witnessing increased foot traffic.
Signs of recovery in Manhattan's office market
Despite surveys suggesting lower rates of return and an office market collapse narrative, there are indications that Manhattan's office market is recovering. CBRE reported a 35% increase in leasing volume in Q2 compared to the same period in 2023. SL Green, the city's largest commercial landlord, stated in its Q2 earnings report that it is on track to exceed its goal of signing two million square feet of leases this year.
Commercial property expansion amid market recovery
Blackstone, the world's largest owner of commercial property, is expanding its space at Rudin's 345 Park Ave by 250,000 square feet. Despite these positive signs, Manhattan's office availability remains high at over 17%, largely due to an oversupply of outdated, undesirable space. High interest rates and looming foreclosures also pose challenges to the market.
