Remote working means changes for real estate
29 May: COVID-19 has forced the issue of working from home to the forefront of many organisations thinking, but it has simply turned up the dial on a shift in working behaviour that has already been gaining pace and that the real estate sector must respond to.
In March, as we began to appreciate to the massive impact of coronavirus, the largest commercial real estate company in the world, CBRE, published a research report looking forward to 2030 and the ways in which the industry would be transformed.
Front and centre of the report was the prediction that workspaces would be fluid; employees would no longer be tied to centralised offices, instead working wherever and whenever they needed to fit into their daily lives. It concluded: “Workers today are setting up at coffee shops, in co-working spaces, on couches and at picnic tables – even when they travel. Over the next decade, CBRE predicts this radical reimagining of the workplace will accelerate.”
Two months on and Lewis Beck, Head of Workplace for CBRE EMEA, confirms that the lockdowns are having an impact on the pace of change. “Trends that were defining the future of work have been accelerated as organisations have had to adjust during the COVID-19 pandemic,” he says.
“The key question for organisations now is not: ‘Can we work from home?’, but ‘Should we work from home and if so, to what extent and what are the implications we need to consider?’. This includes personal productivity, health and wellbeing, employer liabilities, tax, culture, ways of working, technology as well as the design of the workplace.”
In the short-term, as workplaces strive to be ‘COVID-secure’, Beck says the design and allocation of space will be evaluated through the lens of how to limit the transmission of disease, reinforce hygiene and safeguard the health of employees. In offices this is likely to be achieved through phased occupation and shift-based usage, along with social distancing in open plan spaces.
In the long-term, Beck believes that organisations will look to redefine what maximum occupancy should be. “The goal is to find an optimal point between having people so separated that the office lacks energy versus the point at which people feel so exposed that they withdraw from interaction,” he says.
“Now, more than ever, we need to be thoughtful about the size of workstations and the distances of spaces amongst people and throughout the office. Even with the increase in remote working, some organisations may need to increase their footprint to get to a more appropriate, socially acceptable balance.”
In its 2030 forecast, CBRE suggested that almost all employees would be mobile and would need a ‘network of locations’ from which to work. It argued that increased remote working would not mean that centralised offices would no longer exist, but that their design would change to focus on encouraging face-to-face interaction, increasing collaboration and supporting creativity.
Beck explains: “Increased levels of remote working will cause us to be more deliberate about why and when we go to the office. Regardless, companies will still need to make their offices a preferred destination and emphasis on employee experience will be amplified.”
According to CBRE for those in real estate this will involve a focus on providing amenities in office spaces. This will range from providing easy access to food and drink and tech-enabled break-out areas, up to concierge services and health centres in premium offerings. CBRE also predicts the incorporation of technologies into spaces that will provide a “seamless experience” for employees, such as using biometrics for access to buildings.
The increase in remote working will solidify the trend for flexible working spaces, according to CBRE’s report. It describes the business model as “just-in-time” real estate and predicts that more of these co-working spaces will be created close to city centres or large client sites. Data tracking of how spaces are used will be vital for organisations in understanding what mix of long-term office space and flexible spaces they will need. Brian Murphy, CEO of flexible office provider Breather, predicts in CBRE’s report that by 2030 flexible workspace will account for 20% of the total office market.
Meanwhile, fellow contributor Michael Berretta, VP of Network Development at IWG (formerly Regus), said: “Unwieldy, long-term real estate contracts are simply not possible for agile companies—the landscape has changed dramatically.”
While an increasing proportion of office workers had begun to work remotely – even if only infrequently – the coronavirus pandemic has shifted thinking dramatically. Now many more people know it is possible for them to work away from the office for long periods of time and employers will have to respond. Some have already done so, with Twitter announcing in recent weeks that they employees can continue to work from home permanently.
For the real estate sector and its investors the next few years looks to be an exciting one, with their plans for adaptation to remote working potentially brought forward and becoming a reality.