Impacts of the remote work revolution on landlords are expected to grow as leases expire and tenants renew for smaller spaces, according to a new report by Goldman Sachs.

By next year, the company forecasts work-from-home and hybrid schedules will bump overall U.S. office vacancies up 0.8% and an additional 2.3% by the end of this decade. After 2030, vacancies will rise another 1.8%.

That means an increase in the amount of vacant office space of 46M SF by the end of 2024, an additional 125M SF between 2025 and 2029, and another 96M SF in 2030 and afterward. By comparison, in 2022, 49M SF of new office construction was completed, Goldman Sachs reported.

By contrast, Goldman Sachs estimates the drag on the overall U.S. gross domestic product of work-from-home and hybrid schedules will be a modest decline of 0.03% in both 2024 and 2025.

The impact of hybrid will come despite some progress in getting people back to the office, according to the report. The number of people working from home at least part of the week has declined from 47% during the early months of the pandemic to between 20% and 25%. Before the pandemic, however, just 2.6% of the office workforce maintained a hybrid schedule.

Office worker schedules are solidifying around hybrid patterns, according to a survey by Resume Builder. When asked about return-to-office plans, only 2% of respondents said their company never plans to require in-person work. Fifty-one percent now require some or all employees to work in person, while 39% plan to do so by the end of 2024 and 8% plan to by 2025 or later.

Among those companies planning to implement return-to-office mandates in 2024, requiring employees to come in three days per week emerged as the most popular schedule, according to Resume Builder.

Although the worst of the impact may be yet to come, hybrid schedules are already a factor in pushing office vacancies upward. The U.S. office vacancy rate came in at 16.4% in the second quarter, Colliers reported, an increase of 30 basis points compared with the previous quarter. The last time vacancies were in this ballpark was during the Global Financial Crisis, when they maxed at 16.3%.