Tech That Will Change Your Life in 2024

It’s been a crazy year in tech:

• Artificial intelligence infiltrated everything.

• Elon Musk and Mark Zuckerberg agreed to a cage fight (which never happened).

• High-schoolers made pornographic clones of their classmates.

• A high-profile tech CEO was fired and rehired over a weekend.

• Oh, and Apple unveiled its least-mainstream product since the G4 Cube.

We could go on, but we’re here to look forward. That’s the best part about this annual exercise, where we all pile into an electric time-travel vehicle and set the Google Maps destination to The Future.

So what can we predict for 2024? AI as far as the…A-eye can see. We won’t even pretend to know all the things generative AI will do to our devices, our jobs, our lives—and our elections. But we promise you won’t be able to escape it. We’ll see other things too: the decline of the dreaded password, a boom in cleaner energy, increasing regulation around kids on social media, and more.

And yes, Apple will start selling a $3,500 face computer that aims to change how we see the world, or at least our living rooms.

Here are our predictions for the coming year in tech.

Is it real?

When photos of a bull walking on train tracks in New Jersey recently went viral, many people’s first thought was, “Did AI make this?” No, the photo was the real deal. (Don’t worry, the bull is safe now.)

This is the internet challenge of 2024: How do we tell the real from the AI? The generative-AI product flood will continue, but also expect more tools to help us pinpoint artificially generated text, photos, video and audio.

OpenAI, specifically, has promised a feature that will identify whether an image is created by its Dall-E 3 image generator. TikTok has said it is working on ways to detect and automatically label AI-generated content.

The Adobe-led Content Authenticity Initiative, which provides technology to embed information about the origin of an image or video into the file, will also continue to gain steam. Microsoft has said it will launch a tool for political candidates and campaigns that allows them to add credentials to media so people will know how it was created or edited. Camera maker Leica recently announced a new camera that automatically embeds such credentials in its photos.

At some point, we might just regard content without credentials as suspicious.

EVs struggle to accelerate

If you’re expecting 2024 to be the Year of the EV Boom, think again. “It’s not that EV sales are down, it’s that the pace of growth is slowing down,” said Barclays analyst Dan Levy.

That deceleration looks to continue but it marks a turning point: More mainstream car buyers are now catching their breath and beginning to assess their EV options. Two of the biggest consumer pain points—price and charging—will start to improve. Especially for people looking beyond Tesla.

Sometime in 2024, Ford, General Motors, Rivian and others will be able to charge at many of Tesla’s charging sites. That should significantly increase the number of places EV drivers can stop to charge on a long road trip. Additionally, we’ll see the launch of more fast-charging stations funded through the Biden administration’s National Electric Vehicle Infrastructure program. Here’s hoping they work—and actually accept credit cards.

Starting Jan. 1, if you’re buying an EV that’s eligible for a federal tax credit you can get that discount at the point of sale. You will no longer have to wait until you file your taxes. The bad news: Fewer EVs will qualify for the credit. But at least there are some sub-$40,000 EVs on the way, including the Chevy Equinox EV and Volvo EX30.

The clean-tech boom begins

Electric vehicles may seem like the embodiment of so-called “clean tech”—driven in no small part by a certain eccentric billionaire and his car company. But the EV supply chain is enabling hardware companies of all kinds to make use of really big batteries, and the critical “power electronics” that go with them.

For example, in Vermont, the biggest regional utility is turning batteries into a distributed energy-storage network it calls a “virtual power plant.” In-home batteries can recharge from the grid when energy is plentiful, and put it back into the grid when demand shoots up or there are outages, increasing reliability and saving customers money. Even electric vehicles can help in a similar way: Ford says its electric F-150 can power your home in a blackout.

And the relentless rollout of new sources of low-carbon and renewable energy is proceeding apace, including offshore wind, rooftop solar and geothermal power from the earth’s own heat. Startups—backed by big money—are looking to develop a generation of smaller, safer modular nuclear reactors, too.

AI + PC = ?

In 2024, every major manufacturer is aiming to give you access to AI on your devices, quickly and easily, even when they’re not connected to the internet, which current technology requires. Welcome to the age of the AI PC. (And, yes, the AI Mac.)

What’s coming is what engineers call “on-device AI.” Like our smartphones, our laptops will gain the ability to do the specialized computing required to perform AI-boosted tasks without connecting to the cloud. They will be able to understand our speech, search and summarize information, even generate images and text, all without the slow and costly round trip to a tech company’s server.

On Dec. 14, Intel announced its entrants into this race, chips with built-in neural-processing units. Qualcomm announced similar chips in late October. Both silicon giants will compete to power Windows laptops and Chromebooks. Look for more announcements of chips to enable on-device AI, possibly from Nvidia and AMD. Apple—which brought variations of its neural-engine-equipped mobile chips to laptops and desktops in 2020—will be making that specialized processing power available to software developers in new ways.

The hardware will show up before the compelling software applications do, but we’ve already seen some promising demos—like fast AI-powered photo-editing tools.

Longer life for older gadgets

Unlike milk and bread, there’s no expiration date printed on our gadgets’ packaging. That doesn’t mean they don’t have them. Modern, internet-connected devices remain tied to their makers after we buy them. And when the makers stop providing services and software updates, they die.

A growing number of manufacturers and brands are extending software support, however. Apple—which updates iPhones for about six years, and Macs for six to eight years depending on the model—was the gold standard, but it has fallen a bit behind Alphabet’s Google. For its new Pixel 8 phones, Google upped support to seven years. The company also said it will provide updates to Chromebooks for up to a decade starting in 2024.

Samsung previously updated phones for just two years, with four years of security patches. It recently committed to four years of system updates, with an additional year of security. Microsoft announced earlier this month that after support for Windows 10 machines ends in 2025, customers can continue receiving security updates for a fee.

By stretching devices’ lifespans, companies could reduce some of the 6.9 million tons of electronics waste we generate annually, according to nonprofit public-interest group U.S. PIRG.

Apple’s mixed reality meets the real world

Will Apple’s Vision Pro change the way we work by putting floating 3-D spreadsheets on our office walls? Will it make us all yearn to FaceTime with holo-grandma? Will it finally make 3-D movies cool? Or, at $3,499, will it be the world’s most expensive paperweight? We find out in early 2024.

In early trials, we’ve been impressed with just how natural it is to navigate the digital interface with just hand waves and finger taps. It still is quite a substantial piece of hardware you have to put on your head, however, battery pack and all.

Given its price tag and its first-generation status, the Vision Pro isn’t positioned to be a mainstream hit. Instead, Apple’s betting on early adopters and software developers to define the killer apps of spatial computing—the idea that we can blend our real lives and digital worlds in new ways. As Apple Chief Executive Tim Cook said during the Vision Pro’s introduction, it’s “the beginning of a journey.”

Cracks in Apple’s garden walls

Perhaps the president of the European Commission should just move her office to Cupertino, Calif. In 2023, EU legislation forced Apple to give up its proprietary Lightning port in favor of USB-C on the iPhone 15. Next year, EU regulation will push Apple to make additional changes.

While Apple’s App Store has been the only way to install apps on the iPhone, the EU’s Digital Markets Act aims to change that. It requires the “gatekeepers”—specific tech companies—to stop restricting users from getting apps from outside its own app stores. The deadline to comply is March 7. A recent Securities and Exchange Commission filing from Apple stated that the company “expects to make further business changes in the future” to the App Store. (Google’s Android already allows users to install apps downloaded from outside its Google Play app store.)

It’s unclear if Apple would change the App Store only in the EU or around the globe. An Apple spokesperson declined to comment on the company’s plans.

Then there’s Apple’s tightly protected iMessage. Beeper, a new app that brings iMessage to Android devices, has regulators pressuring the giant to open up its exclusive iMessage chat platform. Separately, Apple has agreed to adopt RCS, a messaging standard that will make “green bubble” texting with Android phones a bit more like iMessage.

Passkeys in more places

Passwords are lousy. When hackers exposed information belonging to around 6.9 million customers of DNA test-kit company 23andMe, the company said the attackers tried credentials stolen from other websites. Because people often reuse their usernames and passwords, thousands of logins worked.

That’s why, in 2023, companies including Google, Apple and Amazon moved toward passkeys, a type of login that can replace passwords and two-factor authentication codes. Starting next year, Microsoft will roll out passkeys for businesses.

A passkey is more secure than a traditional login because each is unique, it won’t work on fake sites designed to trick us and it can’t be stolen from company servers. It’s stored inside password managers and can be accessed with a face or fingerprint scan.

Today, over eight billion accounts are passkey-enabled, according to Andrew Shikiar, executive director of FIDO Alliance, which oversees security standards for passkeys. Shikiar expects 20 billion passkey-capable accounts by the end of 2024.

Rocking the vote in 2024

Millions can now generate images and videos with AI—and potentially influence elections around the world. In 2024, an estimated two billion people will vote in 50 countries. While manipulated media isn’t new, the ability to create convincing AI-generated sounds and imagery on a dime is. The White House said generative-AI systems have the potential to “erode public trust and safety in democracy.”

Former President Donald Trump posted a parody of Republican Ron DeSantis’s campaign launch with a video featuring AI-generated voice clones. In turn, a pro-DeSantis super PAC ran a television ad attacking Trump, using an AI-generated version of his voice. Meta Platforms is requiring advertisers to disclose when political ads on its Facebook and Instagram contain digitally altered media.

AI-enabled content isn’t the only concern. We can expect just as much or more old-fashioned disinformation compared with the last presidential election, too, said Erik Nisbet, a professor of communication at Northwestern University. That’s because some social-media platforms have either changed their policies or pared back their content-moderation efforts, Nisbet said.

Research has shown a particular rise in malign content on X, he added. The company didn’t respond to a request for comment. Meta now allows ads to say past elections were “rigged” or “stolen,” a false claim often repeated by Trump. At a conference, Meta’s head of global affairs said private-sector companies shouldn’t arbitrate whether politicians can “make claims or counterclaims about the legitimacy of previous elections.” Google’s YouTube will also no longer remove content questioning the legitimacy of former elections, saying the action could “have the unintended effect of curtailing political speech.”

Ride in a self-driving car—no, really

Robotaxis and self-driving vehicles in general had a rough 2023. GM subsidiary Cruise lost its license to operate in California and subsequently laid off about a quarter of its workforce. Tesla faced lawsuits over its “full self-driving system” on account of its apparent reliance on human monitoring, despite the marketing. And residents of San Francisco, the self-driving-est city in the U.S., expressed doubts about this technology.

Yet amid the chaos, there have been winners—in particular Alphabet subsidiary Waymo, which is continuing to expand its robotaxi service to more cities. If you travel to Phoenix, San Francisco, Los Angeles or Austin, Texas, you can hop in one of the company’s driverless taxis today. And it’s…surprisingly normal?

Meanwhile, Mercedes-Benz gained approval to roll out the first hands-free, eyes-off-the-road autonomous driving system in the U.S. It only works on certain roads, under certain conditions. Jeep and Chrysler parent Stellantis is working on a version, which it says will arrive in 2024. Ford says it will have its version in 2025.

No surprise, then, that in Phoenix, you can now hail a Waymo robotaxi through Uber, thanks to a recently announced partnership. Yes, the future is here. You just might have to go to Phoenix to find it.

Another social-media reckoning

As they seem to every year, Meta and TikTok face massive lawsuits, new laws, curbs from regulators, and the possibility of huge fines.

In 2024, Meta will have to contend with a grab bag of suits from more than 40 state attorneys general trying to force the company to change features of its products that the AGs allege harm minors. These include features that attempt to maximise teens’ and adolescents’ time spent on Meta subsidiary Instagram.

The company said: “We share the attorneys general’s commitment to providing teens with safe, positive experiences online, and have already introduced over 30 tools to support teens and their families.”

In December, the New Mexico attorney general filed a suit alleging the company steers predators to the accounts of children on Instagram. In a statement, Meta said it uses technology, industry protocols and partners in law enforcement, including state attorneys general, “to help root out predators.”

Should the suits somehow force Meta to make its products less appealing, they may accelerate users’ flight to TikTok. That could reignite the long-smouldering fire in Congress to ban the TikTok app outright. The initiative has won bipartisan support, but not enough to make it law. States have attempted their own remedies, but in November a federal judge blocked Montana’s TikTok ban, signalling that such state-level laws are unlikely to stand.

Meanwhile, age verification sounded like a promising move to protect kids on social media. But doing it effectively means clearing some high technical and administrative hurdles. It’s not likely you’ll see that in 2024.

Beyond heartbeats and nighttime Zs

Wearable gadgets have long tracked heart rate and sleep. Soon, they’ll be out for blood.

The Wall Street Journal previously reported that Apple is studying a way to track blood pressure through sensors in the Apple Watch. Next year—when Apple is expected to commemorate the watch’s 10th anniversary with a new design—the company might finally release the feature, which can notify a watch wearer when blood pressure is trending upward and direct the user to verify the measurement with a traditional inflatable cuff, according to a report in Bloomberg.

Other wearables may not be far behind. Fitbit filed a patent application for a display that could estimate blood pressure when pressed. Samsung has offered blood-pressure measurement on its Galaxy Watches for several years, though the feature isn’t available in the U.S. for regulatory reasons. Aktiia is a wrist-based wearable with an optical sensor that can capture 24/7 blood-pressure data. It’s currently only available in Europe, and is awaiting authorisation from the Food and Drug Administration for commercial availability in the U.S. Omron has a larger wearable device available in the U.S. now.

There’s certainly a market for this metric. The devices could make it easier to manage high blood pressure (aka hypertension), which affects as many as 119 million American adults, according to the Centers for Disease Control and Prevention.

This Country Will Police ‘Shrinkflation’ at the Supermarket

SEOUL—Food prices have risen so much that Kim Soo-yeon has developed a suspicious new habit at the grocery store. She has taken to shaking bags of her favourite brands of potato chips to see if they feel lighter.

“If companies are reducing the amount of food by unnoticeable amounts, it feels deceptive,” said the 32-year-old office worker in Seoul.

South Korean authorities will soon be backing her up in the supermarket aisles.

Seeking to temper the effects of inflation, many countries have sought to use political pressure to dissuade food makers from gouging consumers—with higher prices or lower volumes. South Korea is taking things a step further.

Starting next year, the country will require companies to disclose on their packages and websites when grocery items drop in volume, but not price. To ensure firms comply, South Korea is establishing a dedicated price-investigation team to monitor any fluctuations. Officials are considering levying fines, too.

South Korea’s muscular response to “shrinkflation” reflects how a sluggish economy—its projected full-year growth of 1.4% is roughly half that of other wealthy countries—has become a major problem for President Yoon Suk Yeol, whose approval ratings remain stuck in the mid-30s. Those unhappy with Yoon most commonly cite economic issues.

The new proposals to fight shrinkflation came as the government unveiled an initial list of violators. Following a monthlong investigation, authorities said the offerings of everything from beer to Vienna sausages to dumplings had quietly gotten smaller. Some 16 variants of flavored almonds had shrunk, too.

Choi Si-yeon, a 28-year-old office worker, said she was angry when she found out about what had happened with her favourite wasabi-flavoured almonds. Each bag contained 20 grams less, a seemingly undetectable amount.

“If they had raised the price, at least some consumers would notice,” Choi said.

The maker of the snack, a South Korean firm called HBAF, for Healthy But Awesome Flavors, said it had disclosed the product-size changes on its website. The firm pointed to the pandemic, a rise in labor costs and almond prices as factors.

Other companies also claimed to have made online disclosures or argued the slimmed-down offerings were part of flavour revamps.

Shrinkflation backlash has emerged elsewhere, too. France’s second-largest supermarket chain, Carrefour, has put up bright orange signs to highlight products it deems subject to shrinkflation since September. In the U.S., Sen. Bob Casey (D., Pa.) recently issued a report on shrinkflation, citing facial tissues and Oreos as examples.

With costs rising, what is often lacking is transparency over potential changes, creating room for a sense of injustice when shrinkflation occurs, said Rajiv Biswas, chief economist for the Asia-Pacific region at S&P Global Market Intelligence. “Consumers can’t check the website of hundreds of products,” he said.

Headline inflation in South Korea topped out at 6.3% in July 2022 from the prior year, below the recent peaks of 9.1% in the U.S. and 11.1% in the U.K. But food prices in the East Asian country had remained relatively low for decades, so the recent upticks have triggered outsize anger. Wages haven’t kept pace with rising prices. The country’s housing market—the main source of wealth for many South Koreans—has stagnated.

A majority of South Koreans plan to spend less money next year, according to a recent poll, with nearly half of respondents citing inflation as the chief reason.

Low inflation had been a particular policy priority for South Korea over the decades, helping the country’s export-heavy economy maintain a good environment for private investment, said Randall Jones, a former senior official at the Organization for Economic Cooperation and Development who led the group’s economic reports on South Korea.

“People aren’t used to inflation in South Korea,” said Jones, who is now a distinguished fellow at the Korea Economic Institute of America, a think tank based in Washington, D.C.

South Korea is conducting daily price checks for more than two dozen staple items such as milk and ramen noodles. The country’s antitrust regulator will list any shrinkflation examples on a newly created website and will handle enforcement of the new measures. The government wants to ink agreements with large South Korean retailers to build a joint monitoring system for some 10,000 everyday items.

That sliced cheese and other inexpensive items were among the first named shrinkflation violators irks people like Lee Hyun-woo, a 23-year-old university student. “If even processed food is shrinking, I feel betrayed,” Lee said.

In recent weeks, the country’s shrinkflation suspicions have touched everything from the cubed white radish accompanying Korean fried chicken to the cream density of a slice of strawberry cake.

Kim Young-hee, a 42-year-old homemaker, is glad about more government transparency. But the extra knowledge likely won’t change her habits, such as her occasional purchase of honey-butter almonds for her children.

“I’ll still buy the almonds,” Kim said, “but I don’t want to be tricked.”

Picasso, Monet, Warhol, Basquiat, and Richter Lead Artists Powering the US$1 Million-Plus Market

Pablo Picasso, Claude Monet, Andy Warhol, Jean-Michel Basquiat, and Gerhard Richter top a list of 50 artists leading the momentum for works valued at US$1 million or more, according to a report released Tuesday by Sotheby’s and ArtTactic, a London art market analysis firm.

The list ranked artists with an average of five artworks of US$1 million or more that sold each year between 2018 and 2022 at Christie’s, Phillips, and Sotheby’s—a methodology aimed at showing consistency. The analysis also considers sales value, liquidity, average prices, bidder confidence, and market momentum for each artist, and draws on Sotheby’s internal data on bidders and private sales.

Works by the top five artists alone made up more than a third of all US$1 million-plus sales at these top global auction houses in those years, the report said.

Shifts may be afoot, however. A “Power Rank” of top artists in the US$1 million-plus category, based on data from July 2022 to June 2023, “aims to identify artists whose markets show signs of growing momentum and interest,” the report said.

The top artists of this 12-month Power Rank are Jasper Johns, Lucian Freud, Paul Gaugin, Wassily Kandinksy, and Willem de Kooning.

“The Artists Who Power the $1 Million+ Market” is the second report by Sotheby’s and ArtTactic to explore this segment of the auction world, which proved to be “especially resilient” in 2021 and 2022, during the height of the pandemic and the beginning of the war in Ukraine. Despite representing a “small fraction” of works sold at auction, art that fetches at least US$1 million has “a tremendous impact on the market at lower levels,” the report said.

The analysis considers auction results at Christie’s, Phillips, and Sotheby’s in four categories: contemporary (including Post-War), impressionist and modern, Old Masters, and Chinese works of art. The list of top 50 artists from 2018 to 2022 who are powering the US$1 million-plus sector also includes insights from Sotheby’s private sales and its bidding activity data. Though the latter information is from Sotheby’s alone, similar activity is likely taking place at other auction houses, the report said.

“We all know that the art market has never been as transparent as the financial markets, so any information we can give our clients in terms of trends, analysis, and insight will allow them to make more thoughtful and educated decisions about their purchases, whether they see them as an investment or are pursuing a passion,” Mari-Claudia Jiménez, Sotheby’s head of global business development, said during a roundtable discussion with her colleagues and ArtTactic CEO Anders Petterson that’s included in the report.

The rare insight into private-sale data revealed that works by Alberto Giacometti, in addition to Monet, Basquiat, Picasso and Warhol, made up nearly 80% of Sotheby’s private transactions in the first half of this year. From 2019 to the first half of 2023, these same artists represented only 44.7% of private sales.

Sotheby’s internal bidding data—also rare to see—shows a rise in bidding for works with estimates between US$20 million and US$50 million in the first half of this year. “Despite market uncertainty,” this lofty segment has attracted 6.1% of bidders in the market for works valued at US$1 million or more, up from 3.8% in 2022, the report said.

Nearly 75% of Sotheby’s bidders raised their paddles for works priced between US$1 million and US$5 million from 2018 to 2022, though the percentage slipped to 72.4% in the first half of the year as 13.8% of collectors bid on works valued between US$5 million and US$10 million (up from 12.5% in 2022).

ArtTactic dug deeper into this internal bidding data to understand what category of works these collectors favoured, where they live, and how old they are. The data “provides collectors with additional context to understand some of the drivers behind emerging trends,” the report said.

Among its findings: Contemporary art was favoured by 56.1% of bidders; North Americans bid the most, representing nearly 36.4% of those vying for works of US$1 million or more; and Generation X is making their mark, accounting for the largest share of bidders in the market at 40.2%.

This generational shift is significant. Younger collectors are more comfortable buying across art categories, from Old Masters to Contemporary, for instance.

“The data in the report shows that our collectors, even the youngest ones, are interested in the entire span of history,” Brooke Lampley, Sotheby’s head of global fine art, said during the roundtable. “Education is such an important factor in the art market, and people are learning about art history in many different ways today.”

These younger collectors are interested in art in part because they are more exposed to it than previous generations, Lampley said. Private collectors today are exposed through the numerous art fairs they attend in addition to public auctions, which generations ago were attended more by dealers and others in the trade who then sold the works, she said.

“There has been a great effort to make people feel included in the art world and to make it accessible, both by galleries and auction houses,” Lampley said.

Notably, there are no women artists among the top five of the list of 50 powering the US$1 million-plus market, although four made the larger list. Joan Mitchell ranks No. 17, Yayoi Kusama ranks No. 19, Cecily Brown ranks No. 39, and Helen Frankenthaler ranks No. 47.

This Couple’s Milwaukee Home Lets Them Live Separately. They Couldn’t Be Happier.

Jason Kuwayama hardly ever goes to the front section of the new house he built in downtown Milwaukee’s Lower East Side. That is where his girlfriend, Leah Busse, plays “Call of Duty” in her designated game room—a space filled with her collectibles and art.

Instead, Kuwayama, an attorney, enters through the back of the house and spends most of his time in the main living area, an open, light-filled space with no clutter.

The two sections of the house are separated by a long hallway and an outdoor courtyard.

It is a similar scenario upstairs, in the primary suite: The two share a bedroom, but Kuwayama’s pristine bathroom is down a long hallway, and separated by the laundry room, from Busse’s, which is usually filled with clothes.

This arrangement suits them both well.

“My style is reductionist. I am a bit fastidious,” says Kuwayama, 43, who spent around $1.9 million building the house over 3½ years, finishing in 2021.

“I am a mess monster,” says Busse, 38, who works for a home-building company. “Jason wanted me to have my own space that he didn’t have to see.”

The separation between the front of the house and the back was part of a larger scheme for the house, designed by Brian Johnsen and Sebastian Schmaling of Milwaukee-based Johnsen Schmaling Architects to help create privacy in a demographically dense location.

Kuwayama bought the long, narrow—24-foot-wide—infill lot for $35,000 from Milwaukee’s Department of City Development. It sits tightly between two other houses and the setback is right up to the edge of the sidewalk, a requirement of the city aimed at preserving the neighbourhood’s character. Most of the other homes on the street are traditional, two-level structures with pitched roofs built as affordable housing a century ago—and most have the drapes drawn on their front windows to block prying eyes.

Jason Kuwayama and Leah Busse outside their home.

To allow the same privacy as those drapes but still let in light, Johnsen Schmaling came up with an exterior facade that acts as an abstract curtain, with slanted fins made from a hybrid of wood and aluminium. The tightly spaced vertical louvers are installed at gradually rotating angles with various degrees of openness, in part to imitate the movement of curtains and to respond to whether there’s glass or solid wall behind it.

“It creates a sense of mystery,” says Brian Johnsen, whose firm dubbed it Curtain House. The fins also act as a sun-shading device to protect the home from overheating in the summer.

A courtyard, bracketed between the front two-story section and the back two-story section, acts both as a buffer and a source of light, since it is open to the sky. Light comes into the house through the floor-to-ceiling glass windows that line the hallway along one side and the rooms (the kitchen one side, Busse’s game room on the other) on each end.

The main living area is open from the courtyard to the big windows and balcony that look over the river in back, also allowing in flood of light. The kitchen has a white island with an induction range and cabinets without hardware that open with a push, adding to the streamlined effect. The pantry is in back of the kitchen, also behind hardware-less doors.

The staircase, which leads both downstairs to the garage entry and a mud room and a cigar room and upstairs to the primary bedroom, has transparent glass panels supporting the tread on the ascending part, making the main floor feel wider and allowing a view of the river. The furniture is modern and sparse: a sea green Room & Board sofa, a glass Noguchi coffee table and a Barcelona chair.

Outside, the terrace is covered in fine grained rock and has a stairway with three platforms that leads down to the river. It has a pastoral feel, with trees and bushes fringing the property.

Kuwayama’s urban, modern, minimalist, open-plan, colour-free aesthetic is partly a revolt against his childhood home, a French chateau-style house in the Brookfield suburb of Milwaukee. His mother liked wallpaper and carpeting. His father leaned toward teak and Midcentury Modern art. The result was a compromise, with lots of small, separate rooms and bathrooms with their own colour (one avocado green, one brown and one pink).

Busse’s taste veers more toward traditional: an old manor with big wood banisters filled with knickknacks, she says. But she says she wasn’t interested in the design of the house because it was Kuwayama’s project from the start. Working for a home builder, she didn’t want to think about house plans when she was at home—and she wanted to move to a house with a big yard in the suburbs, she says.

Living in inner Milwaukee was also a form of rebellion for Kuwayama. He says when he was a teenager, growing up in the suburbs, it was implicit that he wasn’t to go downtown. After studying undergrad at Northwestern University, in Evanston, Ill., he attended Marquette University Law School, right in downtown Milwaukee, and stayed there after he graduated, eventually buying a condo along the north side of the river, about a half mile from his new house.

The couple met in 2014 on $2 taco night at a local restaurant called BelAir Cantina, when Kuwayama and his friend bought drinks and food for Busse and her friend. Busse promised to meet him at the same place the following week, but never showed. A few weeks later, she saw him at a Starbucks. (Locals call the city “Smallwaukee” because running into people you know is so common). Kuwayama retaliatorily ignored her, but she tracked him down and asked him out.

Busse, along with her dog and cat, moved into Kuwayama’s 1,150-square-foot condo in 2016. They liked living together but the space was too small, says Kuwayama. “You could never get away from anybody. You couldn’t separate at all,” he says. He saw the lot for sale and negotiated the price down from $140,000 to $35,000, in part because the land was so difficult to build on, he says. Kuwayama says the city was supportive of his project, allowing variances, because it wants the neighbourhood to remain single family homes.

Milwaukee has been going through a process of urban revitalisation for decades. Once a centre of manufacturing, attracting immigrants from across the world, Milwaukee’s population hit a peak of 741,324 in 1960, making it the 11th-largest city in the country and a centre of brewing beer. The city was immortalised in the TV show “Laverne & Shirley,” about roommates who worked at a brewery there.

Like many Midwestern cities, Milwaukee was hit hard by the recession in the 1970s and 1980s, while at the same time many of the more affluent residents moved to the suburbs. Over a 30 year period, from 1970 to 2000, due to the relocation of industry and competition from emerging markets overseas, manufacturing employment plummeted by more than 77,000 jobs, and accounting for nearly 95% of all job loss in Milwaukee since 2000, according to the City of Milwaukee. The latest census puts the city’s population at 577,000.

In the 1990s, the city implemented its Riverwalk initiative, a 3-mile pedestrian path that goes along the Milwaukee River, connecting downtown to the Third Ward. The city estimates property values around the path have grown by $1.5 billion since 1993 and moves are under way to expand it.

Architecturally, the city hasn’t evolved as quickly. Polish Flat and German Duplex structures—two-family homes with one unit stacked on top of the other—still dominate the street where Kuwayama built his house. Homes in the area have been increasing in value, up around 25% over the past year as of October 2023, according to Redfin. A few blocks away, a two-bedroom, one-bathroom, 1,160-square-foot, 19th century house that was remodeled sold for $254,000 in September 2023, while a two-bedroom, two-bathroom, 2,662-square-foot unit in a newly renovated condo building with a courtyard sold for $612,000 in July 2023.

Kuwayama says the reaction from people walking by his house (captured on security cameras) is mixed: Some love it, others are put off by the fins on the facade. One guy routinely takes dates through their back deck to their platforms overlooking the river. But he doesn’t mind. “I’m committed to the city of Milwaukee,” says Kuwayama. “Being accessible to the community is part of that.”

A Flurry of Bidding Has Started on a Mint Condition Spider-Man Comic

An impressively well-preserved issue of The Amazing Spider-Man No. 1 from 1963 will be sold at auction early next year and bids have already reached six figures.

The inaugural issue, which cost 12 cents when it hit newsstands 60 years ago, is in such good condition that it’s being called the “world’s greatest copy” by Heritage Auctions, which is selling the collectible as part of its Comics & Comic Art SignatureAuction, running from Jan. 11-14.

Considered to be in “near mint/mint” condition, the issue has a grading of 9.8 out of 10 from Certified Guaranty Company (CGC), a third-party grading service for pop-culture collectibles.

The comic is from a collection that was amassed by an employee of a museum who stored the comics in tight packs on the museum’s premises. It’s “considered one of the best Silver Age collections ever discovered,” said Heritage Auctions, referring to the Silver Age of Comic Books, a period that spanned roughly from 1956 to 1970 and saw the creation of some of the most famous superheroes including the X-Men, the Hulk, Iron Man and, of course, Spider-Man.

As of Wednesday afternoon, the current bid for the comic, which marked Spider-Man’s first appearance in his eponymous title, stood at US$220,000.

In July, another first issue of The Amazing Spider-Man, in slightly worse condition, sold for US$520,380.

Also selling at the auction is “one of the world’s finest copies” of Superman No. 1 from 1939, according to Heritage. It’s one of only two in the world graded a 7.0 by CGC and considered to be in “fine/very fine” condition.

“This is the finest unrestored copy we’ve ever offered,” the auction house said online.

A Superman No. 1—with a CGC grading of 8.0—sold for US$5.3 million in January 2022, breaking the record for the most expensive comic ever sold.

As of Wednesday afternoon, the highest bid for the issue stands at US$460,000.

‘Thrifting’ Extends to Holiday Shopping Too

A new kind of present is gaining acceptance this holiday season. More consumers are picking secondhand items to gift each other, finding it to be an environmentally and budget-friendly option.

Thrift stores that sell used clothes and goods are springing up online and on street corners. Goodwill Industries International, the nonprofit behind the familiar chain of thrift stores, is ramping up its online efforts. Fashion brands are developing their own resale offering to keep up with clothing-reseller sites such as Depop and Poshmark. Roughly 17% of gifts this holiday season will be a resold item, according to software firm Salesforce.

“Consumers are choosing resale first because of the incredible value, the unique merchandise, and the incredible sustainability benefit,” said Matt Kaness, chief executive of GoodwillFinds, the nonprofit’s online e-commerce platform run in partnership with Salesforce.

Secondhand clothes, once seen as frumpy and embarrassing, are now keenly sought out by the fashion conscious. A popular vintage aesthetic dovetails with consumer calls for goods that do less harm to the world. About 85% of American shoppers have bought or sold preowned items over the past year, nearly a third for the first time, according to online marketplace OfferUp’s Recommerce report. In apparel alone, some 10% of the global market will be secondhand by next year.

GoodwillFinds is the only major nonprofit player in resale.

GoodwillFinds’ online platform allows a smarter operation than the traditional bricks-and-mortar store, said Kaness, formerly an executive with retailers including Walmart and Urban Outfitters. The platform uses artificial intelligence and large data sets to more accurately price and categorise items, creating a much more efficient system, Kaness said.

“In a store, it’s a human looking at the item. They have paper sticker tickets for the price and they have to process such a volume that it is somewhat random,” he said. In contrast, the company’s online system uses computer vision to take a picture, identify the item, create a listing and price it.

Moving online is the logical choice for secondhand sellers, said 25-year-old Brooke Bowlin, who runs lifestyle blog Nuance Required. “Secondhand stores just can’t sell enough,” said Bowlin, who started her own thrift store in Siloam Springs, Ark. “By moving online and expanding the audience, there is an opportunity to re-home more clothes,” she said.

Major fashion brands are also increasingly recognising that secondhand is as much a necessity as it is an opportunity. The fashion industry is responsible for up to 8% of global emissions, relying on resource-intensive raw materials and fast-moving trends that have contributed large amounts of waste. Around 11.3 million tons of textile waste go to landfills in the U.S. every year, according to environmental organisation Earth.Org.

Outdoor-clothing retailer Patagonia established its Worn Wear platform in 2017, one of the first resale channels by a major brand.

As much as adapting to trends, Patagonia Worn Wear aims to change consumer behavior, said Asha Agrawal, managing director of the Patagonia venture fund that runs the platform.

“A lot of our messaging is around—‘you don’t need to buy something new,’” she said.

Worn Wear buys back used brand gear from consumers by paying higher prices than peer-to-peer apps or other marketplaces, Agrawal said. This strategy contributes to the bulk of the platform’s costs but also boosted its inventory fourfold this year alone, she said, adding Worn Wear has been profitable for the last two years.

Worn Wear is now integrated into the Patagonia brand. “You can now do your main shopping with Patagonia with our resale business in the U.S.,” she said. “That’s a huge evolution for us.”

Resale by brands and third parties is expected to outpace traditional thrift sales and donations in the U.S., rising to 60% of a $70 billion total by 2027 from 15% of the $20 billion secondhand market in 2017, according to online thrift store ThredUp’s recent resale report.

Other fashion players have their versions. Sweden’s Hennes & Mauritz launched H&M Pre-Loved in the U.S. this year, in partnership with ThredUp. Inditex-owned Zara has launched a preowned platform that offers repair services, customer-to-customer sales and donations of used garments in the U.K. and France, with plans for a U.S. rollout by 2025.

Resale remains an imperative for fashion brands as a way to control distribution and retain the trust of shoppers increasingly alert to the fate of their old clothes. However, scaling up resale generates a raft of operational challenges such as authentication, returns and ensuring that secondhand doesn’t look like an afterthought, said Anita Balchandani, fashion lead at consultant firm McKinsey & Co.

Unlike nonprofits, such as Goodwill, that get their inventory from donations and don’t have to be accountable to shareholders, retailers are struggling to make business sense of resales, Balchandani said.

“No one has proven the path to scaling this up profitably,” she said. “You almost have to create a whole new end-to-end supply chain…. The retailer who cracks that journey is going to make a real difference in this space.”

Millionaires Are Moving to These Countries in Droves

The global migration of high-net-worth individuals has expanded this year, with Australia returning as the top migration destination, according to a report Tuesday from Henley & Partners.

Approximately 120,000 of the world’s millionaires moved to a new country in 2023, according to the consultancy firm, which specializes in residence and citizenship by investment. That’s up from 84,000 in 2022 and expected to rise to 128,000 in 2024, the data showed.

Safety, a lower cost of living, favorable tax regimes and a high quality of life are top reasons for high-net-worth individuals to migrate. The top five destinations for high-net-worth individual migration this year include Australia, the United Arab Emirates, Singapore, the U.S. and Switzerland, according to the report, which defines high-net-worth individuals as those with US$1 million or more of investable wealth.

Meanwhile, China, India, the U.K., Russia and Brazil lead the ranking of countries with the most people leaving for other shores.

Roughly 82,000 high-net-worth individuals moved to Australia between 2002 and 2022, with another 5,200 arriving this year, the data showed. The country was also in the top spot between 2015 and 2019.

“Australia consistently attracts sizable numbers of millionaires every year, mainly from Asia and Africa, but more recently also from high-income countries such as the U.K.,” according to Andrew Amoils, head of research at New World Wealth, which teamed up with Henley & Partners for the report.

The country’s beautiful beaches and wide-open spaces, a high quality of life and an advanced economy, as well as good healthcare and education opportunities, make it a top pick, Amoils added.

Migration to the U.A.E. in 2023 was one of the highest on record, with around 4,500 millionaires moving there.

“Pre-pandemic, the U.A.E. traditionally saw net inflows of around 1,000 high-net-worths per year,” the report said. “Most incoming millionaires in 2023 are expected to come from India, with large numbers also coming from the U.K., Russia, Lebanon, Pakistan, Turkey, Egypt, South Africa, Nigeria, Hong Kong and China.”

Dubai has been a clear beneficiary of this trend, with home prices in the city rising nearly 20% annually in the third quarter, according to Knight Frank.

Singapore was the Asian city that saw the most millionaires move in last year, while the U.S. saw a steady stream of new residents migrate from Asia. Switzerland remains Europe’s top wealth hub and attracts new residents because of that, the report said.

This article originally appeared on Mansion Global.

He Stole Hundreds of iPhones and Looted People’s Life Savings. He Told Us How.

RUSH CITY, Minn.—Before the guards let you through the barbed-wire fences and steel doors at this Minnesota Correctional Facility, you have to leave your phone in a locker. Not a total inconvenience when you’re there to visit a prolific iPhone thief.

I wasn’t worried that Aaron Johnson would steal my iPhone, though. I came to find out how he’d steal it.

“I’m already serving time. I just feel like I should try to be on the other end of things and try to help people,” Johnson, 26 years old, told me in an interview we filmed inside the high-security prison where he’s expected to spend the next several years.

For the past year, my colleague Nicole Nguyen and I have investigated a nationwide spate of thefts, where thieves watch iPhone owners tap their passcodes, then steal their targets’ phones—and upend their financial and digital lives.

Johnson, along with a crew of others, operated in Minneapolis for at least a year during 2021 and 2022. In and around bars at night, he would befriend young people, slyly learn their passcodes and take their phones. Using that code, he’d lock victims out of their Apple accounts and loot thousands of dollars from their bank apps. Finally, he’d sell the phones themselves.

It was an elaborate, opportunistic scheme that exploited the Apple ecosystem and targeted trusting iPhone owners who figured a stolen phone was just a stolen phone.

Last week, Apple announced Stolen Device Protection, a feature that likely will protect against these passcode-assisted crimes.

Yet even when you install the software, due in iOS 17.3, there will be loopholes. The biggest loophole? Us. By hearing how Johnson did what he did, we can learn how to better secure the devices that hold so much of our lives.

How he got started

Johnson isn’t a sophisticated cybercriminal. He said he got his start pickpocketing on the streets of Minneapolis. “I was homeless,” he said. “Started having kids and needed money. I couldn’t really find a job. So that’s just what I did.”

Soon he realised the phones he was nabbing could be worth a lot more—if only he had a way to get inside them. Johnson said no one taught him the passcode trick, he just stayed up late one night fiddling with a phone and figured out how to use the passcode to unlock a bounty of protected services.

“That passcode is the devil,” he said. “It could be God sometimes—or it could be the devil.”

According to the Minneapolis Police Department’s arrest warrant, Johnson and the other 11 members of the enterprise allegedly accumulated nearly $300,000. According to him, it was likely more.

“I had a rush for large amounts at a time,” he said. “I just got too carried away.”

In March, Johnson, who had prior robbery and theft convictions, pleaded guilty to racketeering and was sentenced to 94 months. He told the judge he was sorry for what he did.

How he did it

Here’s how the nightly operation would go down, according to interviews with Johnson, law-enforcement officials and some of the victims:

Pinpoint the victim. Dimly lit and full of people, bars became his ideal location. College-age men became his ideal target. “They’re already drunk and don’t know what’s going on for real,” Johnson said. Women, he said, tended to be more guarded and alert to suspicious behaviour.

Get the passcode. Friendly and energetic, that’s how victims described Johnson. Some told me he approached them offering drugs. Others said Johnson would tell them he was a rapper and wanted to add them on Snapchat. After talking for a bit, they would hand over the phone to Johnson, thinking he’d just input his info and hand it right back.

“I say, ‘Hey, your phone is locked. What’s the passcode?’ They say, ‘2-3-4-5-6,’ or something. And then I just remember it,” Johnson described. Sometimes he would record people typing their passcodes.

Once the phone was in his hand, he’d leave with it or pass it to someone else in the crew.

Lock them out—fast. Within minutes of taking the iPhones, Johnson was in the Settings menu, changing the Apple ID password. He’d then use the new password to turn off Find My iPhone so victims couldn’t log in on some other phone or computer to remotely locate—and even erase—the stolen device.

Johnson was changing passwords fast—“faster than you could say supercalifragilisticexpialidocious,” he said. “You gotta beat the mice to the cheese.”

Take the money. Johnson said he would then enrol his face in Face ID because “when you got your face on there, you got the key to everything.” The biometric authentication gave Johnson quick access to passwords saved in iCloud Keychain.

Savings, checking, cryptocurrency apps—he was looking to transfer large sums of money out. And if he had trouble getting into those money apps, he’d look for extra information, such as Social Security numbers, in the Notes and Photos apps.

By the morning, he’d have the money transferred. That’s when he’d head to stores to buy stuff using Apple Pay. He’d also use the stolen Apple devices to buy more Apple devices, most often $1,200 iPad Pro models, to sell for cash.

Sell the phones. Finally, he’d erase the phone and sell it to Zhongshuang “Brandon” Su who, according to his arrest warrant, sold them overseas.

While Johnson did steal some Android phones, he went after iPhones because of their higher resale value. At bars, he’d scope out the scene—looking for iPhone Pro models with their telltale trio of cameras. He said Pro Max with a terabyte of storage could get him $900. Su also bought Johnson’s purchased iPads.

Su pleaded guilty to receiving stolen property and was sentenced to 120 days at an adult corrections facility in Hennepin County, Minn. Neither Su nor his lawyer responded to requests for comment.

On a good weekend, Johnson said, he was selling up to 30 iPhones and iPads to Su and making around $20,000—not including money he’d taken from victims’ bank apps, Apple Pay and more.

How you can prevent it

A week after my trip to Minnesota, Apple announced Stolen Device Protection. The security setting will likely foil most of Johnson’s tricks, but it won’t be turned on automatically.

If you don’t turn it on, you’re as vulnerable as ever. Switching it on adds a line of defence to your phone when away from familiar locations such as home or work.

To change the Apple ID password, a thief would need Face ID or Touch ID biometric scans—that is, your face or your finger. The passcode alone won’t work. And the process has a built-in hourlong delay, followed by another biometric scan. This same slow process is also required for adding a new Face ID and disabling Find my iPhone.

Some functions, such as accessing saved passwords in iCloud Keychain or erasing the iPhone, are available without the delay but still require Face ID or Touch ID.

A criminal might still be motivated to kidnap a person with lots of money, then slowly break through these layers of security. However, the protections will likely dissuade thieves who just want to grab phones and flee the scene.

So what loopholes remain? A thief who gets the passcode could still buy things with Apple Pay. And any app that isn’t protected by an additional password or PIN—like your email, Venmo, PayPal and more—is also vulnerable.

That’s why you should also:

  • Add a distinct passcode to money apps, like Venmo and Cash App.
  • Delete any notes or photos that include personal information such as passwords or Social Security numbers. Store that stuff in a secure note inside a third-party password manager, such as Dashlane or 1Password.
  • Create a stronger iPhone passcode—one that uses letters and numbers.

The most obvious is Johnson’s advice: Watch your surroundings and don’t give your passcode out.

If this crime has taught us anything, it’s that a single device now contains access to our entire lives—our memories, our money and more. It’s on us to protect them.

Nicole Nguyen contributed to this article.

The Met to Return 16 Statues to Cambodia and Thailand Over Trafficking Concerns

The Metropolitan Museum of Art has agreed to return 14 sculptures to Cambodia and two to Thailand, removing from its collection all Khmer-era artworks associated with an art dealer accused of selling antiquities illegally.

The Met said Friday it will temporarily display a selection of the 16 sculptures while arrangements are made for their repatriation. The works were made between the ninth and 14th centuries in the Angkorian period, the museum said. The Khmer empire ruled much of what is now Cambodia, Laos, Thailand and Vietnam from about 802 to 1431.

The sculptures are associated with art dealer Douglas Latchford, who was indicted in 2019 by the U.S. attorney’s office for the Southern District of New York, which said he orchestrated a multiyear scheme to sell looted Cambodian antiquities on the international art market. The indictment was dropped after Latchford’s death in 2020. Authorities later secured a $12 million civil forfeiture against his estate for stolen Southeast Asian antiquities they alleged Latchford had sold.

The Met said it cooperated with authorities in the U.S. and Cambodia following Latchford’s indictment and received information that made it clear the sculptures should be returned.

“The Met is pleased to enter into this agreement with the U.S. attorney’s office, and greatly values our open dialogue with Cambodia and Thailand,” said Max Hollein, the director and chief executive of the Met.

U.S. Attorney Damian Williams said in a statement Latchford was believed to have run “a vast antiquities trafficking network,” an allegation Latchford had denied. He urged cultural institutions and private collectors to remain vigilant about antiquity trafficking.

Many countries and cultures that were colonised have for decades asked institutions to return stolen artefacts. That effort has gained more traction in recent years, with many museums now openly acknowledging that some items in collections were gained through colonial exploitation and looting.

The Cambodian government in recent years has asked the Met and other museums to return artworks taken from their countries of origin under murky circumstances.

In 2013, the Met returned two 10th-century Cambodian stone statues, known as the “Kneeling Attendants,” which were also associated with Latchford. The statues were from the Koh Ker temple in the same province as the Angkor Wat temples. Officials said they believe they were stolen from the temple in the 1970s. The Met had acquired the statues from donors between 1987 and 1992, it said at the time.

One of the most high-profile repatriation efforts involves the Benin Bronzes, West African artefacts stolen more than a century ago from what is now Nigeria.

Roughly 3,000 to 5,000 artefacts were pillaged from the Kingdom of Benin by British soldiers in the late-19th century as the U.K. expanded its colonial empire in West Africa.

Many of the Benin Bronzes—a name used to cover a variety of artwork, including carved elephant tusks, brass plaques, and wooden heads—wound up in private collections and museums in Europe and the U.S. The Met returned three artefacts to Nigeria in 2021.

The Office Market Had It Hard in 2023. Next Year Looks Worse.

Office building owners, hammered by falling demand and high interest rates, struggled in 2023. But they mostly managed to stay afloat.

That is going to be a lot harder to do next year.

Many landlords have been able to extend their loans, often by putting in more capital. But a lot of those extensions are now expiring, and owners are losing hope that occupancy rates will rebound soon.

That means many more office landlords will be compelled to pay off their mortgages, sell their properties at a steep discount or hand their buildings over to their creditors.

“In 2024, it’s game time,” said Scott Rechler, chief executive of RXR Realty, a major owner of office buildings in the New York region. “Owners and lenders are going to have to come to terms as to where values are, where debt needs to be and right-sizing capital structures for these buildings to be successful.”

Office demand shows no sign of returning to pre pandemic levels. While the number of full-time remote employees has dwindled, hybrid workplace policies look here to stay. In the fourth quarter, 62% of U.S. businesses allowed employees to work from home some days of the week, up from 51% in the first quarter, according to Scoop Technologies.

Return-to-office rates also stalled for most of 2023. Kastle Systems, which tracks security-card swipes in 10 major U.S. cities, said that average office attendance is about half of its pre pandemic level. Placer.ai, which tracks mobile phone data, puts it in the 60% to 65% range. But it also said the return rate has topped out.

The office market has shown “some monthly fluctuations but little real change in the overall trajectory,” Placer.ai said in a November report.

The U.S. office vacancy rate stands at a record 13.6%, up from 9.4% at the end of 2019, according to data firm CoStar Group. The firm is forecasting it will rise to 15.7% by the end of 2024 and will peak above 17% by the end of 2026.

That vacancy rate is poised to push higher because nearly half of office leases signed before the pandemic haven’t expired, CoStar said. When they do, many of the businesses will likely take less space than they are currently occupying, whether they are renewing or relocating.

Take the case of Chicago law firm Neal Gerber Eisenberg, which signed one of the city’s largest 2023 office leases earlier this fall. The firm, which has grown steadily throughout the pandemic, adopted a policy that requires employees to work from the office at least eight days a month. Neal Gerber leased 90,000 square feet at its new location, down from the 113,000 square feet it will be giving up.

Beyond the longer-term decline in demand, office landlords are still contending with high interest rates. Landlords that have to refinance debt borrowed when rates were at historic lows will face much higher borrowing costs as high vacancy is putting rents and incomes under pressure.

In recent weeks, inflation has been declining and the Federal Reserve is likely to ease interest rates in 2024. That will soften the blow. But landlords still face a financial squeeze, analysts say.

“If you have a mortgage that’s expiring at 3% or 4%, there’s no way you’re refinancing at 3% or 4%,” said Steve Sakwa, an analyst with Evercore ISI. Even though rates have come down, he added, property owners are still looking at rates that could be double their expiring rates to refinance.

Not all the signals are bleak for the office market in 2024. Demand is still strong for the highest quality and best-located space in many markets from tenants willing to pay high rents to encourage employees to return to offices.

Developers have retreated from new construction in the sector, so there’s little competition from new supply. The 30 million square feet in office construction starts in 2023 was the lowest amount since 2010, according to CoStar.

Cities such as San Francisco, New York and Boston are lowering costs and streamlining the process for converting obsolete office buildings into apartments. While this isn’t expected to result in a big decline in vacancy, the actions might bring more activity to business districts, giving a psychological boost to downtown landlords and businesses.

But the steadily rising number of owners who are defaulting on their mortgages because of falling rent rolls looms over the market. The delinquency rate of bank loans and loans converted into commercial mortgage-backed securities currently is over 6% compared with below 1% before the pandemic hit, according to data firm Trepp.

High delinquencies combined with the dismal office outlook already have convinced some owners to hand properties back to lenders or sell for sharply discounted prices.

In Stamford, Conn., the owner of One Stamford Forum, a 500,000-square-foot building whose tenants include troubled Purdue Pharma, this fall gave the building back to its creditors, according to Trepp. In San Francisco, buyers have purchased office buildings like 60 Spear Street and 350 California Street for fractions of what they were worth before the pandemic.

Trepp is projecting that the office delinquency rate could be over 8% by the second half of next year. As more landlords default, the new owners that replace them—buying in at greatly reduced prices—will likely put more pressure on the market because they’ll be able to charge lower rents and still make a profit.

“What could be catastrophic is if you start seeing corporate profit pressures leading to continued or accelerated pace of office downsizing,” said Stephen Buschbom, Trepp’s research director.