By Mike Sayre - 16th February, 2021
The tectonic shifts in work and workplace of the past year have created new challenges for real estate strategists. As part of PLASTARC’s ongoing webinar series guiding people and organizations in developing a roadmap to their future office, we invited experts to discuss what the last year of rapid change means for portfolios.
Our panelists were Kay Sargent, Senior Principal and Director of Workplace at HOK; Martha O'Mara, Ph.D, Principal at Place Strategy Partners and Jen Petersen, PhD, Urban and Workplace Sociologist. PLASTARC Sociospatial Designer Amy Rosen moderated this lively and wide-ranging conversation.
Data from previous PLASTARC webinars shows the magnitude of the challenge at hand. Our survey respondents indicated that they expect to average 2.7 days working out of the office after COVID-19 has passed, versus 0.9 days before it began. This has huge implications for occupancy, building design and lease arrangements.
As O’Mara pointed out, real estate forecasting has always been difficult. Often, expectations around a business’ performance might be a bit fuzzy more than a year or 18 months in advance. Real estate professionals must make commitments that may be 5-10 years in duration, or more. This inherent difficulty has been compounded by the greater uncertainty of this moment. There is now more urgency around a conversation that was already happening about purpose of place.
Sargent noted that the process of creating better workplaces starts with being honest about what wasn’t working well in the first place. At the beginning of 2020, much of the office experience was still designed around the legacy of paper files and landline phones. To date, there has been insufficient consideration of the human side of occupancy and performance, to say nothing of global priorities like sustainability, climate change and social responsibility.
Petersen pointed to a problematic frame of mind as a cause. Thinking of real estate as a cost center rather than a contributor to performance can block organizations from making the investments and portfolio changes that are necessary to improve experience. Now that people have become much more adept at working out of the office—and are likely to continue to do so—that mindset will have to change. As O’Mara said, “If you don’t have to go to the office, what’s going to make you want to?”
The social and so-called “soft” elements of workplace will shape portfolio needs in the future, and real estate strategies need to start by studying how these preferences have changed. Asking people what they want and need is still the best way to uncover practical steps that can be taken with leases and policy that can lead to better experiences.
Some of these new priorities are direct outcomes of the pandemic itself. For example, cleanliness has always been a concern for facilities professionals, but occupants may not have thought about it much. Likewise, O’Mara pointed out that pandemic preparedness will now be a part of the business landscape as well.
Petersen suggested that another route to concrete impact is for leaders to think more broadly about their roles in the community. How do we want workplaces to impact localities? For instance, right now, how are downtown businesses like cafes and restaurants doing without as many employees present? How has the organization’s environmental footprint been impacted by the shift to telework? Many employees want their companies to take a greater role in supporting their communities, and may support real estate changes in that vein. For example, sustainability-minded occupants may appreciate a better end-of-trip experience for people who commute by bike.
New sources of uncertainty mean that it is more important than ever to employ flexible, future-ready strategies. Ultimately, even if the needs of the people who occupy offices are changing rapidly, the long timeline of buildings remains broadly the same. Spaces designed today will be used for 5, 10, or even 20 years. In closing, O’Mara said, “We’re not gonna go back to the way we were, let’s make that a good thing.”