ST. LOUIS — The pandemic has wiped away billions of dollars in property value nationwide over the past two years, but for St. Louis’ largest office buildings, the decline started even sooner.
Over the last decade, a collection of the region’s largest office buildings dropped nearly 24% in appraised value, a Business Journal analysis found. From 2012 to 2021, the market values of 18 of the region’s largest 25 office buildings — data calculated by local governments and kept by the Business Journal as part of its annual list of the largest office buildings — lost more than $150 million.
Most of that decline came from buildings in downtown St. Louis, which had $217 million in value wiped away from its office buildings even as St. Louis County’s share of the largest office buildings gained $65 million in value over the same period. Downtown's poor results can be attributed in part to the decline of the state's largest office building, the AT&T tower, which lost nearly 90% of its appraised value, or nearly $121 million, over 10 years, much of that caused by AT&T vacating the building for another one downtown in 2017.
Yet even excluding AT&T tower, which sold in May for just over $4 million, downtown's biggest office buildings still lost $127- million, or nearly 15% of their appraised value, during the 10-year period.
The decade-long decline in value in the largest buildings was part of a long-term trend of investors turning away from St. Louis due to lack of rent growth, which makes buildings less profitable, and a "chicken-and-the-egg" scenario in which people and businesses leave, causing investors to exit, and spurring even more people and businesses to vacate, local real estate professionals said.
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