At Columbia Business School, Stijn Van Nieuwerburgh is the Earle W. Kazis and Benjamin Schore Professor of Real Estate as well as an accomplished professor of finance. Outside the walls of CBS, however, Van Nieuwerburgh is known for dedicating the past four years of his career to documenting the potentially catastrophic trend of declining commercial real estate values in New York City.
In honor of his success in bridging the gap between research and practice, he was recently awarded CBS’s inaugural Practice Prize Award. Presented by Oded Netzer, vice dean of research and the Arthur J. Samberg Professor of Business, the award recognizes a faculty member who has made significant contributions to the practice of business and policy. During a panel event following the award ceremony, Van Nieuwerburgh discussed the future of real estate in a post-COVID world with Melissa Román Burch, chief operating officer of the New York City Economic Development Corporation (NYCEDC), and Keith Banhazl, managing director and head of US commercial real estate finance at Moody's Investors Service.
Both panelists recognized Van Nieuwerburgh for his groundbreaking research on the intersection of housing, asset pricing, and macroeconomics — what he calls the urban doom loop. The dramatic albeit fitting term refers to how the rise of remote work in New York City has led to a decline in commercial property values, which in turn generate less tax revenue. This loss of tax revenue eventually leads to a decline in population and empty storefronts, as the quality of city services — such as sanitation, education, and policing — declines.
“New York City has lost something like 400,000 people since the onset of the pandemic. So that's a big number,” Nieuwerburgh said at an event in December. “And if we don't stop this doom loop, this situation could sort of spiral out of control like it did in the 1970s in Detroit.”
But thanks in part to Van Nieuwerburgh’s research, not all hope is lost. Beginning in April 2020, he and his colleagues have been diligent in not only sounding the alarm on this “train wreck in slow motion” but also coming up with tangible solutions. Policymakers, large real estate corporations, and groups like the NYCEDC have used Van Nieuwerburgh’s research to inform their decision-making and shape regulation around housing and development.
His work has also been referenced by the Biden administration and cited widely in media outlets such as 60 Minutes, The Atlantic, and The New York Times. In fact, just days before Van Nieuwerburgh received the CBS award, the New York state legislature approved a landmark budget for fiscal year 2025 that includes policies to ease the commercial and residential real estate crises. They include establishing new tax incentive programs to construct affordable housing, extending the 421-a tax incentive for six years for projects already in the pipeline, and creating incentives to convert unused office space into affordable housing.
Burch, who worked with state policymakers on the bill, praised Van Nieuwerburgh’s research for bringing attention — and solutions — to one of the country’s most pressing problems.
“The urban doom loop was very helpful for us because it really represented the high price of inaction,” Burch said during a panel discussion following the award ceremony. “Prophet monikers aside, it was an easy-to-digest concept for the public and in that way became a powerful tool for the government because it articulated what the crisis scenario could look like. Avoiding the doom loop was a clear call to action for our government leadership.”
Van Nieuwerburgh’s doom loop hypothesis had been brewing for some time before it became a common media mention in 2022. That year, Van Nieuwerburgh, along with New York University Professor Arpit Gupta and University of North Carolina Professor Vrinda Mittal, published a working paper titled, “Work From Home and the Office Real Estate Apocalypse.”
In the paper, the researchers detailed how the remote work trend reduced office values by approximately 33 percent, which over the first year of the COVID-19 pandemic led to a value loss of about 28 percent. Applying that 28 percent reduction to the value of the entire US office stock, the researchers found that commercial real estate had seen a $500 billion reduction in value.
Banhazl knew Van Nieuwerburgh and was familiar with his work prior to the urban doom loop theory, as the two had worked together on Moody’s board. However, as he flipped through TV channels and stumbled upon Van Nieuwerburgh’s 60 Minutes interview in January 2023, it put the impact of the professor’s work into perspective.
“The award Stijn’s receiving today is not just a recognition of excellence but a testament to his dedication, creativity, and ongoing pursuit to collaborate and offer his knowledge,” Banhazl said. “His work has brought interest and been thought provoking for many within and outside of the commercial real estate industry.”
While the term urban doom loop and related monikers may project a hopeless outlook on first read, Van Nieuwerburgh’s research and the recent passage of real estate legislation by policymakers actually suggest the opposite. As Van Nieuwerburgh told The New York Times in February, “What happens to New York City from here on out depends on the actions we take and the policy decisions that are made. It’s not inevitable.”
