Tuesday, January 5, 2021

What Will Be the Future For Office Buildings?


Dror Poleg, author of “Rethinking Real Estate” and the co-chair of the Urban Land Institute’s Technology and Innovation Council in New York, has written a piece at The New York Times on his thoughts.

Here are key snippets:

[B]uildings in many traditional employment districts will have to compete more fiercely, and a small but significant percentage of office space will most likely have to be repurposed into housing, e-commerce fulfillment centers, delivery-only kitchens, health care centers, meeting spaces, event spaces and other uses.

Residential areas, street retail shops and hotels may have to accommodate more daytime workers.

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Post-Covid for example, a Brooklyn or Queens resident who previously commuted to Manhattan may opt to work several days a week in a shared space within a 10-minute walk from home. Some large employers are already experimenting with satellite offices in the suburbs of cities in which they already have a downtown headquarters. The main office will remain important for most companies, but fewer employees will be expected to be there all day, every day.

The office will become more of a consumer product. And just like every consumer product, the office will have to continually fight for its customers and meet their needs — not only when it’s time to renew the lease. Offices will need spaces for specific tasks like focused work, team brainstorming, client presentations and employee training. And they will need to be more focused on individuals, even if these people work for a large company.

RW thoughts:

If there is going to be a permanent move in the direction of remote work, it is likely that we are going to see new apartments and houses that have "office broadcast spaces." That is a small (or big) nook in a residence where one can work from home in a separate area, from the bedroom or kitchen, that is specially designed to make it easier to work and do zoom conferences when necessary and provide interesting backgrounds.

If firms are going to allow remote working from residences or elsewhere, it is very likely they will want to get all employees together, face-to-face, say quarterly, in conference spaces. Thus, the potential for conference space could be major, especially for desirable locations. The conference consulting business will probably be a boom area.

It will be interesting to see how much office space is turned into residential space. It would help in providing significant new supply in areas with tight supplies since presumably most of the reconstruction would be done inside which would eliminate a lot of the objections to new structures going up.

6 comments:

  1. "If firms are going to allow remote working from residences or elsewhere, it is very likely they will want to get all employees together, face-to-face, say quarterly, in conference spaces."

    -- WeWork's revenge!

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  2. "It will be interesting to see how much office space is turned into residential space. It would help in providing significant new supply in areas with tight supplies since presumably most of the reconstruction would be done inside which would eliminate a lot of the objections to new structures going up."

    Zoning codes/regulations will be a major impediment in most big cities

    ReplyDelete
  3. I have seen the future and it's Gary, Indiana. (Try Google Satellite view)

    ReplyDelete
  4. As someone who has worked "remotely" for the better part of a decade, I'll tell you that it's not a lasting trend, particularly if you work in a business based on billable hours.

    Anywhere within the first 6 to 18 months, it's new and exciting. You love the "freedom" of being home without having to conform to the office environment norms. You can get up in the middle of the morning for a coffee break or to do a load of laundry.

    And then you realize that you're home, but you're also at work. Meaning, getting away and truly "unplugging" gets harder and harder. Focus diminishes. If you have to make hours, productivity slips. You keep saying to yourself, "I feel stuck here." This is particularly difficult if you don't have dedicated space to work within your living arrangement. If you've got a studio or workshop in an outbuilding somewhere, that's different, of course.

    I've known many people who have been in positions to work from home, people who even owned their own business, but had to either go back to the office or find rental space to work outside of the home because it was getting to them. There were too many distractions from the home side. They needed the space that the office was taking up.

    Moreover, I do not believe that productivity can be maintained this way. It's early, yet; give it maybe a year.

    ReplyDelete