Boston Properties, owners of 200 Clarendon (center) and the Prudential Center (right, rear) say data from Kastle, the company which tracks office building occupancy, doesn’t include its buildings.

Two of the nation’s largest owners of office buildings and towers have a bone to pick with Kastle. 

At a recent industry conference, top executives at Boston Properties and Synergy took aim at the Virginia-based company, which tracks how many workers badge in at office buildings around the country. 

Both questioned whether Kastle, which routinely reports that office properties in major cities are still at best half full, is providing a completely accurate view of the state of the nation’s office market. 

The criticism highlights how comparatively little data we have about the seismic shift toward remote work and its impact on the office market, especially in the market’s most expensive segment. 

A Gap in Coverage 

For his part David Provost, senior vice president of leasing at Boston Properties, said Kastle does not have a presence in the office buildings the company owns. 

That would appear to be a significant gap in Kastle’s market coverage given the publicly traded office giant has more than 190 buildings compromising 50 million square feet in Boston, Los Angeles, New York City, San Francisco, Seattle and Washington, D.C. 

“There is just so much noise – every day there is a story about people not coming back, and the data source is Kastle Systems,” said David Provost, senior vice president of leasing at Boston Properties, told the crowd at NAIOP Massachusetts’ recent Future of the Office event. 

“What’s unclear to me: Who is Kastle Systems and what are they comparing their numbers to,” Provost added. “Here is a fun fact: “We are the largest owner and operator of premiere workplaces in the country, with major holdings in Boston, and Kastle Systems isn’t in one of our buildings.” 

Nor is it just Boston Properties lobbing these rhetorical hand grenades. 

Matthew Godoff, executive vice president of Synergy Investments, indicated during comments at the same NAIOP event that the same was true for his firm, which controls 4 million square feet of office space in Boston and the suburbs. 

Synergy’s holdings include the Center Plaza complex across from Boston City Hall. 

BXP: Many Workers Back 

Both executives said they have seen a big rise in the number of workers returning to the office. 

BXP’s Provost said the typical pattern now is three to four days a week in the office, compared to one or two days a year ago. 

The heart of the workweek now is Tuesday, Wednesday and Thursday, when office utilization rates at Boston Properties’ towers and other buildings hit 70 percent. 

Synergy’s Godoff offered similar numbers, noting a growing desire, especially among younger workers, to get back to the office. 

“The younger generation is getting sick and tired of being in their small apartments working remotely,” Godoff said.  

He noted that getting on the job training and interacting with co-workers is crucial to professional growth, and that “it is hard to do that sitting behind a screen at home.” 

The relatively high office occupancy stats Boston Properties and Synergy are reporting stand in contrast to Kastle’s latest reports, which cite much lower numbers. 

Kastle tracks occupancy in 10 of the largest office markets, including New York, San Francisco, Los Angeles, Austin and San Jose, among others, 

And its most recent reports portray and office market that is slowly recovering, but still struggling to get above 50 percent occupancy. 

The dueling data points raise the question of accurate a picture Kastle offers of the market in the premiere class A towers, and whether the firm’s number are heavily weighted towards the class B market, made up of older, more worn buildings, the executives suggested. 

“I think the day of reckoning is coming for the bottom half of the market,” Provost said. 

So, what does Kastle have to say about all this shade being thrown in its direction? 

Through a spokesperson, the company declined to address the specific criticisms raised by the Boston real estate executives. 

Who’s Got It Right? 

However, the company itself been around for more than half a century, starting out in building security, where it has a major presence. 

Starting with the pandemic, Kastle also began to track building occupancy, tallying electronic card swipes by 300,000 office workers in 10 different cities, according to its website. 

And as far as the class A office market goes, Kastle, in a write-up on the “science” behind its numbers, say it has that covered as well. 

The company claims to collect data on 200 buildings in New York City, with two-thirds of them being class A towers. 

Scott Van Voorhis

And Kastle contends its numbers line up with those of other data collecting groups and agencies, while also being vouched for by a Stanford University professor. 

So, who’s telling it straight here? It would be a stretch to say Kastle numbers are somehow wildly inaccurate. And executives at a publicly traded, office-heavy landlord like Boston Properties have an incentive to downplay concerns about office demand.  

That said, the top end of the office market may be doing better than people realize. And if Kastle doesn’t have a presence in Boston Properties office towers, those numbers aren’t showing up in its data. 

At the end of the day, though, office occupancy is an extremely useful number amid the changes wrought in the workplace by the pandemic. If nothing else, Kastle is to be credited for being a pioneer and attempting to track it. 

Scott Van Voorhis is Banker & Tradesman’s columnist; opinions expressed are his own. He may be reached at sbvanvoorhis@hotmail.com.