The relationship employees have with the office is changing thanks to the COVID-19 pandemic, and business leaders are altering how they invest in office space.
To understand how leaders view office real estate, a giant in the sector, JLL spoke to 1,095 decision-makers across 13 markets.
Discussing the study, Dr Marie Puybaraud, global head of research at JLL Work Dynamics, noted: “The next three years will prove to be an inflection point for real estate as businesses plot their future path and rethink the purpose of their portfolio.
“The changes accelerated by the pandemic represent an opportunity to pause, think about a long-term real estate strategy and how it aligns with future business priorities.”
With this comment in mind, let’s examine what JLL’s study uncovered.
Adjusting to hybrid work
Although 72% of decision-makers believe the office is critical to doing business, leaders understand the importance of offering hybrid work. In fact, 77% of respondents see a hybrid or remote work offering as critical to attracting and retaining talent.
Of course, using offices less regularly means that organizations need to reassess their investments in real estate. 43% of companies intend to increase investment in flexible spaces by 2025, while 51%will lease flexible working areas through a third-party provider.
Given that collaboration opportunities are a primary driver for office space for 45% of respondents, it is unsurprising that 73% want to make working areas more open and less desk-focused.
Cynthia Kantor, chief client value and growth officer at JLL Work Dynamics, shared: “As the office finds a new purpose post-pandemic as a destination for collaboration in employees’ hybrid workstyles, occupiers will need to continue increasing their investments in creative spaces.
“Enhancing socialization, especially among a large, often geographically dispersed, workforce will be critical to future talent strategies, as the office accelerates its role as the innovation hub of the work ecosystem.”
ESG and technology
Environmental, social, and corporate governance (ESG) is a huge motivator for businesses that also plays into the reallocation of real estate.
77% of respondents told JLL that investing in quality space was important, while 74% said they would likely pay a premium for green credentials. These credentials simply show that businesses are making a conscious effort to have a positive environmental impact.
56% of those surveyed said that they already intend to pay for green credentials by 2025.
Interestingly, these decisions may be driven by employee wants; just under 80% of organizations said that employees want their workplaces to make a positive influence on society.
To meet the goals outlined in this study, companies will need to invest in technology.
Currently, only 13% of companies are collecting real-time data or using advanced data to understand employees. On top of that, businesses will need to enable staff to book desks and collaboration spaces in order to make the most out of their spaces and avoid overcrowding.
The space where we work is changing, it’s now an imperative that businesses enable themselves to keep up with the times.
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