'The office is likely not going to recover to pre-pandemic levels in terms of the actual office space per employee'
Too often, companies are using the wrong motives to return to the office.
So says J. P. Gownder, vice-president and principal analyst at Forrester Research in Boston, citing money paid for a lease, a financial interest in the property, the optics of low occupancy -- or a CEO who prefers in-person.
“None of these are very strategic; none of them are reflective of the vast changes that have happened in which employees feel differently about where and how they can be most productive; what would give them fulfillment, and how all of the technology investments that organizations have made over the last two-and-a-half years to empower remote work: How does that change what we need to think about in terms of the office?”
Gownder and others recently released a report, The Future of The Office, that imagines what the office of the future might look like. It was compiled after interviews with 722 employees at 45 organizations in the U.S., Canada, and U.K. in the second quarter of 2022.
Future of real estate
So, what does the future look like for commercial real estate?
The answer is murky, according to Greg Taylor, managing director of Colliers International in Halifax.
“Tenants who have office leases, they haven’t gone to renegotiate their leases and reduce their footprint early. Now, when they are renewing, there is definitely conversations and considerations around how much space they need going forward. Just about everybody’s looking at: ‘If I had 10,000 square feet before the pandemic, and now my lease is up, do I need 10,000 square feet still?’’ he says.
“Some businesses are saying yes and some are saying no.”
It is clear, however that transformation is indeed in the air, says Michal Wywrot, president and cofounder of LCH Developments in Scarborough, Ont.
“We’re now in a paradigm shift. The office is likely not going to recover to pre-pandemic levels in terms of the actual office space per employee. With what happened in the last couple of years, there’s likely to be a lack of new investment and a backlog of office space. It’s probably going to take a good five years but at that five-year mark, there’s going to once again be an office shortage,”
Employee experience
However, it’s also clear that the office as a place is not dead, says Gownder.
“No matter how remote your organization is, there was broad agreement among everyone we interviewed that in-person still mattered on some level; that there is a distinct purpose for in-person collaboration. Even companies that don’t even have an office or never did have an office, in-person still mattered,” he says.
“And the reason for that is simple: the office no longer needs to be the place where we think about getting all of our work done. That is a very antiquated model at this point but it is a place not to get work done, but to get work done with other people.”
Most of the studies that have been conducted show that people are anywhere from three to 15 per cent more productive on average working remotely, says Gownder.
In speaking with the 722 workers, feelings about leaving home for work have certainly shifted.
“They said things like: ‘I don’t understand why I was going to the office five days a week. It’s not consistent with my life. This commute time is very damaging to my work-life balance so I would rather go in for a purpose, but not because I’m required to be there just to just physically show my face.’ Rather, they wanted more of a meaningful interaction instead of simply face time,” he says.
‘Anywhere offices’
Whether workers are home or in the office, a new reality is upon us that Forrester is dubbing the “anywhere office,” according to Gownder.
“The anywhere office essentially moves away from the hub-and-spoke hierarchy and says that every node on the office network -- whether that’s a home office, a physical office or… the airport, a client site, a café… is co-equal in the sense that it is an equal participant in the organization.”
For companies to succeed in transitioning the workplace into the modern form, HR leaders need to become “shepherds of change,” he says, and ensure senior leaders understand what needs to happen.
“The status quo that’s in the mind of the C-level may not be reflective of what your actual employees are looking for and if you’re going to be a good steward of the employee experience, and you’re going to cut down on things like increases in attrition, it’s certainly in HR leaders’ best interest to understand that the office is no longer a place, and to help make sure that the investments are happening to make sure that their employees stick around and that they can recruit people in the future.”
Employers also need to “look at the office as a tool to attract and retain talent and as also as a tool to encourage people to come back to the office, says Taylor. “It’s gone from a commodity into, if you do it right, it can be a competitive advantage.”
With new office plans in place, digital infrastructure is also being reimagined, says Taylor.
“If it was one change you can point your finger at it is to ensure that you’ve got adequate bandwidth to run multiple Zoom rooms or video conferencing rooms.”
As well, with the rise of coworking spaces, brand new technology is a big help.
“We have these padlocks and key readers: it’s all connected through a central app where you can open your office, you can enter the office through just an app; you don’t need a key. There isn’t a lot of friction,” says Wywrot.
