Jeffrey Gural, Chairman of GFP Real Estate LLC
For our latest interview in the Expert Insights series, we had the pleasure of chatting with Jeffrey Gural, chairman of GFP Real Estate LLC (formerly Newmark Holdings and Newmark Knight Frank).
Gural joined Newmark Knight Frank in 1972. He served as chairman until 2017 and now holds the title of chairman emeritus. For approximately six years prior to that, he was a member of the staff of Morse-Diesel Construction Co., where he was responsible for the supervision and construction of more than 1 million square feet of new office space in notable buildings such as 437 Madison Ave. and 645 Madison Ave.
Read on for his insights on the office market in 2025.
Q. What is the #1 challenge the office market will face this year?
If a building owner has a loan coming due, they’re facing the harsh reality of refinancing at much higher interest rates — jumping from around 3% to 6.5%. That can be a major financial strain.
If a loan isn’t coming due, then the challenge shifts to making the right investments in a building. In the class B office sector, success hinges on upgrades — modern lobbies, updated hallways, stylish bathrooms and well-built tenant spaces. Without these improvements, landlords will struggle to compete. As a landlord of primarily class B buildings, GFP Real Estate is constantly upgrading its portfolio in order to stay competitive in the marketplace.
On the tenant side, the market is tightening once you remove outdated office stock and the ultra-premium spaces. For mid-market companies, finding quality office space in desirable neighborhoods — like the Village, TriBeCa, SoHo and Chelsea — at a reasonable rent is becoming increasingly competitive.
Q. How have the last five years transformed the office market?
Over the last five years, the office market has undergone a dramatic shift. When COVID hit in 2020, office buildings emptied out almost overnight. As the pandemic continued, the work-from-home model took hold with many tenants — especially nonprofits — realizing they could save on rent while employees enjoyed the flexibility of remote work. Some organizations even went fully remote with employees relocating to places like Florida, Colorado and Utah.
However, that trend is gradually reversing. Many companies are now bringing employees back into the office at least three or four days a week. While Fridays remain quiet, Monday through Thursday has become the new standard for in-person work, signaling a slow, but steady recovery for the office market.
Q. How widespread is the adoption of hybrid work models among tenants and how long-term is this trend?
The adoption of hybrid work models among tenants is widespread and seems to be a lasting shift in how businesses operate. Initially, during COVID, most companies went fully remote. Over time, that evolved into a gradual return — first two days a week, then three and now often four. While Fridays may never be as busy as they once were, most businesses now have employees coming in at least a few days each week.
There isn’t a major industry that completely avoided remote or hybrid work. Nearly every sector experienced some level of adjustment. Today, it’s rare to find a successful business where employees aren’t in the office at least part of the time, suggesting that hybrid work is here to stay.
Q. What are you expecting to see in 2025 in terms of market trends?
In 2025, I expect to see significant economic headwinds that could shape the real estate market. With federal budget cuts taking hold, many businesses that rely on government funding are already struggling. If this continues, I believe we could see a recession unfold, particularly as layoffs impact older workers and government agencies scale back services.
From a real estate perspective, uncertainty looms. While some investors are still buying, a recession could shift market dynamics quickly. Distressed assets — like office buildings converted to residential — may continue to be attractive opportunities, but overall caution is warranted. The deal needs to make sense financially. If job losses accelerate and consumer confidence dips, the broader market could tighten, making 2025 a challenging year across multiple sectors.
Q. What innovations will enable a safer, more streamlined and more comfortable office experience going forward?
Innovations in office buildings are focusing on enhancing safety, efficiency and overall tenant experience. We have been installing destination dispatch elevators in all our buildings, which take you directly to your floor and reduce the number of people that have to share an elevator, so it’s also healthier. In larger buildings, advanced air filtration systems — with germ-killing lighting and HEPA air purification — are being implemented to create a healthier environment. While the impact of high-end amenities is still up for debate, they remain a key selling point for attracting tenants.
Beyond physical improvements, experiential perks are becoming a major factor in tenant satisfaction. Small, but thoughtful gestures — like giving out roses on Valentine’s Day or running tenant-only contests for free football and concert tickets at MetLife Stadium (something we do) help create a more engaging workplace. Additionally, practical support, such as subsidized childcare and nursery programs, can make office life more accommodating for working parents. Last year, GFP partnered with local nursery school Buckle My Shoe Preschool to offer childcare to GFP tenants at a 50% discount.
These kinds of initiatives not only make offices more appealing, but also help strengthen tenant relationships, reinforcing the value of in-person work.
Q. Are any office space types and amenities seeing increased attention recently?
Innovations in office design are increasingly focused on flexibility, collaboration and access to outdoor space. Many tenants, especially tech companies, prefer the industrial aesthetic — open ceilings, exposed ductwork and polished concrete floors — over traditional carpeted offices with drop ceilings. Additionally, workplace kitchens and communal lunch areas have become essential, fostering collaboration and providing an alternative to eating at desks.
Outdoor spaces are also playing a major role in making offices more comfortable and appealing. At 322 Eighth Avenue, GFP Real Estate is creating a rooftop amenity space that will offer conference areas, phone booths, a kitchenette, and both indoor and open-air seating areas to work from. Employees appreciate the ability to step outside, whether for a meeting or a lunch break. These types of amenities not only enhance well-being, but also contribute to a more engaging and enjoyable office experience.
Interested in being interviewed for our Expert Insights series? Feel free to reach out to us at [email protected] or check out other articles from our series here.
