Amazon’s recent mandate, requiring employees to return to the office five days a week starting in May 2024, has sparked considerable debate about the future of work and the impact on downtown Seattle. The company’s shift from a three-day-a-week policy, established earlier in 2023, represents a significant departure from the hybrid work models adopted by many companies in the wake of the COVID-19 pandemic. This decision marks a return to pre-pandemic norms for Amazon, but also raises questions about whether other companies will follow suit and what the broader implications will be for urban centers like Seattle.
The Downtown Seattle Association (DSA), led by President Jon Scholes, is optimistic that Amazon’s move will influence other businesses. With approximately 50,000 employees in Seattle, Amazon is the city’s largest employer, and its decisions carry significant weight. Scholes believes that Amazon’s return to a full-time in-office policy sends a strong signal to other organizations grappling with the optimal work arrangements for their employees. While many companies have embraced hybrid models, allowing for some remote work, Amazon’s stance suggests a belief in the benefits of full-time in-person collaboration and its potential to foster innovation and productivity.
The impact of remote work on downtown Seattle has been profound. Pre-pandemic, the area bustled with activity, fueled by the presence of numerous tech companies and their employees. However, the shift to remote work led to a significant decline in foot traffic, with November 2024 weekday worker numbers reaching only 56% of the pre-pandemic levels recorded in November 2019. This stark contrast with cities like Miami and New York, which have nearly recovered to their 2019 levels, highlights the unique challenges faced by Seattle. City leaders view the return of office workers as crucial for revitalizing downtown and restoring its vibrancy.
Scholes argues that Amazon’s return to five days a week in the office is “significant and influential” not only for other companies but also for the small businesses that rely on the patronage of office workers. Increased foot traffic translates to increased revenue for these businesses, many of which have struggled to survive during the pandemic and the subsequent rise of remote work. Moreover, a greater presence of people downtown contributes to a sense of safety and security, a key priority for Mayor Bruce Harrell. Scholes contends that “more people in a public space is a good thing” and that Amazon’s return will enhance both real and perceived safety in the downtown area.
Despite the optimism surrounding Amazon’s return, the commercial real estate market in downtown Seattle faces significant challenges. Office vacancy rates have soared, surpassing 30% in the third quarter of 2024, a substantial increase from the 24.3% recorded in the same period the previous year. This surge in vacancies has placed considerable strain on commercial real estate developers, with some facing defaults on office debt. Ironically, Amazon itself has contributed to the rising vacancy rates by relinquishing nearly 595,000 square feet of office space in Seattle this year, opting to let leases expire and relocate employees to nearby Bellevue, where the company has invested in new office towers.
The long-term impact of Amazon’s return-to-office mandate remains to be seen. While the DSA hopes it will inspire other companies to follow suit, the prevailing trend seems to favor hybrid work models. The high office vacancy rates in downtown Seattle suggest a continued struggle for the commercial real estate market, even with Amazon’s commitment to in-person work. The interplay between Amazon’s decision, the evolving preferences of workers, and the dynamics of the real estate market will ultimately shape the future of downtown Seattle. The success of this bold move hinges on whether it truly fosters increased productivity and innovation, as Amazon believes, or if it ultimately proves to be an outlier in a world increasingly embracing flexible work arrangements.
