America‘s Commercial Real Estate Show

Office Market Contrarian Investing with Rod Kritsberg

Sep 16, 2025
Rod Kritsberg, Co-founder and CIO of KPG Funds, specializes in ultra high-end boutique office properties in New York City. He discusses the contrasting performance of luxury office spaces versus lower-quality ones and how rising interest rates impact investor sentiment. Kritsberg highlights contrarian investment opportunities created by shifting tenant demands and emphasizes the importance of location and property quality. He also explores the evolving capital markets and potential value appreciation as the office landscape continues to change.
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INSIGHT

Tale Of Two Office Markets

  • New York shows a "tale of two cities": ultra-high-end offices see record rents while lower-quality stock faces serious vacancy.
  • Quality and location now drive outsized performance versus commodity office product.
INSIGHT

New Supply Immediately Absorbed

  • Newly delivered high-end office space in NYC leases immediately and pushes market rents higher.
  • Tenant demand for premium amenities and views remains insatiable despite smaller space needs.
ADVICE

Underwrite The Cost Of Capital

  • If you buy the right product in the right location, expect strong returns but underwrite with current capital costs.
  • Build holding-period plans that absorb high interest rates until markets normalize.
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