Aging Elevators: The Looming ‘Elevator Cliff’ & Global Real Estate Risks

A growing number of elevators worldwide are nearing the end of their operational lifespan, creating potential disruptions in major cities. In metropolises like New York and London, instances of stalled elevators are becoming more frequent, leading to what’s been termed an “elevator cliff” – a situation where building functionality is compromised. This issue is also beginning to impact global real estate valuations.

Aging Infrastructure and the Rise of ‘Zombie Elevators’

As of January, a significant portion of elevators in the United States are classified as ‘legacy equipment,’ having surpassed 25 years of service. Considering the typical elevator lifespan of 20-25 years, a substantial number of these systems are operating beyond their intended design life. These are sometimes referred to as ‘zombie elevators.’

Real-World Disruptions

The consequences of this aging infrastructure are already being felt. In New York City, resident Valerie Nimiets had to climb 53 flights of stairs with her dog during a recent downpour due to an elevator outage at her 57-story building, W Residences. Similar incidents have been reported in London, where two elevators simultaneously failed at the 26-story Valron Tower in May of last year.

The average duration of elevator outages in New York City public housing increased by 18% last year, nearing an average of seven hours. The impact of these “elevator cliffs” is disproportionately affecting residents in low-income housing.

Supply Chain and Labor Challenges

A key factor contributing to the problem is the difficulty in sourcing replacement parts. Suppliers are prioritizing new installations in China, leaving older systems in North America and Europe struggling to obtain necessary components. In some cases, a single unavailable part necessitates a complete system replacement.

A shortage of qualified technicians is also exacerbating the issue. The retirement of baby boomer-generation technicians isn’t being offset by an influx of new workers. Elevator installer and repairer positions in the US currently have a median annual salary of $106,580, placing them among the highest-paying construction trades.

Opportunities for Elevator Manufacturers

Despite the challenges, elevator manufacturers are seeing potential benefits. While new installation markets are slowing, particularly in China, the demand for maintenance and modernization services is increasing. The “Big Four” companies – Otis, Kone, Schindler, and ThyssenKrupp Elevator (TKE) – are rapidly restructuring their businesses to focus on service-oriented models.

Otis, the global leader in the elevator industry, reported a 27% increase in modernization orders in the third quarter of 2025. CEO Judy Marks stated this growth indicates customers are recognizing the urgency of replacing aging equipment. Otis’s service sector margin also improved by 0.7% year-over-year.

The risks associated with elevators are now extending into the financial markets. Elevators, once considered a given, are now key determinants of a building’s financial performance. A concept called “accessibility discount” is gaining traction, where the potential for elevator downtime diminishes the value of higher-floor units.

Potential Future Scenarios

While widespread rent collapses or premium reversals haven’t been statistically confirmed, experts caution that the current situation represents an early indicator. A surge in elevators reaching the end of their lifespan could escalate these risks across the broader market.

South Korea, with its high-density, apartment-centric living, is particularly vulnerable. As of December 31, 2024, the country had 866,669 elevators, with approximately 30% being over 15 years old. Many elevators installed during the construction booms of the 1990s and early 2000s are now approaching their replacement cycle. Insufficient long-term repair funds in many apartment complexes could lead to resident conflicts, increased maintenance fees, and safety concerns.

Frequently Asked Questions

What is an ‘elevator cliff’?

An ‘elevator cliff’ refers to a situation where frequent elevator outages in high-rise buildings disrupt building functionality and potentially impact property values.

What is contributing to the increase in elevator failures?

The primary factors are aging infrastructure, with many elevators exceeding their 20-25 year lifespan, supply chain issues impacting parts availability, and a shortage of qualified technicians.

How are elevator manufacturers responding to this situation?

Manufacturers like Otis, Kone, Schindler, and TKE are shifting their focus towards maintenance and modernization services, recognizing the growing demand as elevators age.

What role will infrastructure play in the future of urban living?