Commercial property

CRE 2.0: the office of the future

Joe Small

On March 13, 2020, tens of millions of Americans woke up and went to their offices. A week later, it was a distant memory as the COVID-19 pandemic forced businesses across industries to abruptly shut down and transition to a work-from-home model. For over two years, this was the “new normal” as we all wondered when we would get the green light to resume our pre-pandemic routines. But hopes of a full recovery have been dashed as many companies have announced plans to continue offering fully and partially remote models even after the threat of COVID subsides. This is forcing commercial property owners to radically rethink every aspect of their business and futureproof their buildings to keep vacancy rates low.

The most important thing for landlords and operators to understand is what tenants want. It turns out the answer is very different than it was before the pandemic. The most important thing is security. Simply put, companies won’t be able to convince people to come back to work if they don’t feel like their health is a priority. Beyond that, tenants want more space and comfort to support in-person collaboration. And because this is a tenant market, they will push for more amenities and improved building services.

The secure office

It’s hard to overstate how reluctant people are to return to physical offices. According to a recent Bloomberg article, more than half of Americans say they would actually quit their jobs rather than be forced back to work in person. There are factors other than safety at play, of course, but more than 40% of American workers still have health issues related to being close to co-workers every day. That’s why landlords should do whatever it takes to make sure their office spaces are as safe as possible. This is where the WELL construction standard can make all the difference.

WELL was created in 2014 to recognize buildings that promote tenant health, and WELL-certified buildings are designed to take a holistic approach to health for those who work there. The standard has a number of elements, but when faced with an airborne pathogen like COVID, the most important is air quality.

This can often require upgrades or new expensive heating, ventilation, and air conditioning (HVAC) systems. It typically includes high-efficiency particulate filters (HEPA), which should remove 99.5% of particles such as pollen, bacteria, dirt, dust, moisture, and even some viruses. The HVAC system may also include ultraviolet germicidal irradiation (UVGI), which “inactivates” viral, bacterial and fungal organisms for additional protection. The more buildings can do to improve indoor air quality, the more confident tenants will be to work on it.

If you build it (right) they will come

Security is an important psychological factor in convincing people to return to work, but even if people are confident in virus mitigation measures, they might not want to return to the office. That’s because working from home is incredibly convenient: after all, who doesn’t love the idea of ​​a one-minute commute and spending the day wearing a comfy tracksuit? Unfortunately, the majority of corporate America is requiring people to leave their homes despite a significant pullback from the base. There’s no single way for businesses to convince their teams to meet in person again, but buildings that go out of their way to be as welcoming as possible will have a better chance of attracting and retaining tenants. commercial.

One of the most important changes concerns the use of offices. The traditional workspace includes private offices and workstations where employees spend five days a week doing their jobs. It’s not going to move forward, especially in companies where people are only required to show up two or three days a week. Instead, commercial buildings should create common spaces where people can collaborate in teams. This is where real estate companies will have to get creative in order to be able to balance several needs that may seem contradictory.

One of the biggest office needs is the availability of collaborative spaces. This is fundamentally different from the open-plan office because, unlike traditional layouts, individual employees do not have a defined physical space of their own. It’s also different from having a lot of conference rooms, because people aren’t just looking to sit around long tables and sketch their ideas on whiteboards. One thing that’s essential to remember is that, as many companies are going to offer “hospitality” options, in which people only come into the office occasionally, a team that meets on Mondays will be almost completely different. of a group that meets in the same space on Thursday. In this context, flexibility and adaptability are the keys to success.

After two years of physical distancing, expect many workers who must report daily to require increased spacing between workstations. Redesigned areas should incorporate this, with at least six feet between desks. These offices may require fewer workstations as some staff can work remotely. However, this would also require a shared desktop system. Having multiple small conference rooms available throughout the space can increase worker privacy for one-on-one discussions or for making personal phone calls.

Many experts see new offices using a minimalist design that eliminates clutter and allows staff to focus on work. It will also allow for the creation of multifunctional spaces that will give the working environment greater flexibility. As a bonus, these layouts are easier to clean because they have fewer surfaces.

Public spaces (or pleasure)

No matter how well designed an office is, the building has a hole in it that also needs to be welcoming. No one will want to walk through a poorly ventilated hall or stand in crowded elevators just to get to their place of work. They also won’t want to be crammed into a basement cafeteria on their lunch breaks or confined to a small strip of sidewalk if they want some fresh air. Forward-thinking real estate companies are fundamentally rethinking common spaces to include things like outdoor terraces, well-ventilated on-site cafes and restaurants, and fitness centers that allow for social distancing. Buildings currently under construction or in the planning phase already take this into account, but the good news is that existing buildings can be modified to provide these kinds of services and amenities. Building designs can also be modified to accommodate fitness, comfort and spirit by adding space for exercise and meditation and the ability to control or dim sound, temperature and light. lighting in common areas.

The return to the offices is already in full swing, but it has been an uneven process. In October and November 2021, people were talking openly about the end of the pandemic, and dozens of major companies reopened their offices in hopes that things would go back to how they were before anyone had ever heard of COVID- 19. Then the omicron variant hit, and most of these organizations had to quickly reverse course. Experts predict that the coronavirus will exist for years to come, and it’s not out of the question that we’ll go through several waves of the disease, all of which will affect the way people work.

This uncertainty affects all segments of the economy, some more than the commercial real estate market. Offering spaces that can accommodate workers while offering multiple WELL building concepts can make coming back more attractive, especially for workers who are reluctant to return to the office. Commercial property managers will need to consider these factors to better serve their clients and ensure they continue to have high rental rates.


Joe Little is a Principal at Linesight located in the New York office, where he leads a team focused on cost management for a multi-billion dollar commercial real estate construction project. Little, originally from Ireland, has over 18 years of industry experience in Europe, the UK and the US, holds a BSc in Quantitative Surveying from Technological University Dublin and is a member of the Royal Institution of Chartered Surveyors (MRICS).