Instant discusses the new dispersed office portfolio model that now includes work from home, work near home and the core office.
This research piece was originally featured on Forbes.com as part of the Forbes Real Estate Council.
Months into the pandemic that has forced the ultimate work-from-home experiment, companies including Google, Microsoft, Morgan Stanley, JPMorgan, Amazon and Salesforce, just to name a few, have all reportedly extended their work-from-home options. Salesforce, for example, is allowing employees in all its 160 office locations globally to work remotely for the rest of this year, long after it began reopening offices in phases at the end of May 2020.
Twitter and Facebook have taken a more radical approach and have announced that their employees can work remotely forever. A Twitter representative told TechCrunch, "We were uniquely positioned to respond quickly and allow folks to work from home given our emphasis on decentralization and supporting a distributed workforce capable of working from anywhere. The past few months have proven we can make that work."
Since the start of the pandemic, we have spoken with over 50 heads of corporate real estate across the globe as part of our Agile CRE Think Tank (ACT). As one participant summarized, work-from-home is no longer the enemy of the C-suite. Through these conversations, we have made a conservative estimate that we will see 15%-20% of participating firms will move to a more agile strategy.
This is not the death of the office, but the introduction of what we are calling the networked office, a combination of workspaces including the core office, the remote work-from-home (WFH) strategy and the new work-near-home (WNH) office.
Each location type supports purpose-driven work, ensuring there is a reason and intent for each environment — for collaboration, for community and for concentration, giving employees options when it comes to their physical workspace, ensuring better employee productivity and wellness. The core office of the future will focus on collaboration, connection and brand-centric activities. As the cultural hub of a firm, employees will gather in the core office for innovation and engagement. Trips to the core office will no longer be daily ventures, but will be planned and have specific outcomes, in large part a response to mass-transit commuting concerns.
Going forward, WFH will be used for the "me versus we" work that requires concentration. The desire to avoid crowded commutes and urban areas will lead to the rise of the flexible suburban office and the introduction of WNH. These offices will allow for the first phase of reopening and reengagement with teammates, allowing for a feeling of community while cutting down commute times.
For the last five decades, populations have expanded into suburban areas while commercial centers have stayed the same. This naturally meant that those commuting into the workplace faced longer journeys, something that has not been challenged but simply accepted. WNH will change that.
In the U.S. today, the average worker is thought to spend 225 hours a year commuting, with increasing traffic levels only helping to drive up travel times. When companies look to establish new offices, they often use a research agency to determine which locations provide the largest catchment area for their desired workforce. For white-collar jobs, at least, this has created an interesting focus around major cities, and has created a small number of mega-regions where individuals now commonly spend up to double the national average time commuting. While we had started to see some companies look at ways of reducing this trend as employee wellness grew in importance, for most it has become a normal part of our lives. Until now.
It took a pandemic for companies to realize that employees do not need to be in the office to be productive. For New York, Chicago and London alone, a move to an agile real estate portfolio with a WNH office means potentially millions of people are likely to be looking for a more flexible workplace strategy.
Change To Commuting Figures During Covid-19
Over the last three months, for the first time in recent history, our normal has been forced to change and for many, the lack of commute is one of the biggest positives to come out of Covid-19. Remote working has affected commuting numbers dramatically. Both subways and buses in NYC have seen numbers drop significantly, while Chicago, a city that relies far more heavily on commuting by car, still saw a steep decline of over 50%.
The impact on public transport was most significant as those who used personal vehicles felt safer in their journeys, and local authorities actively encouraged this method of travel. Despite this, the overall volumes of cars entering city centers still dropped dramatically.
As state and local governments open up, the introduction of WNH offices will play a key role in the transition from WFH to office life. Satellite offices in and around major metropolitan areas will allow for more local commuting by employees, by car or bicycle, to low- and mid-rise suburban buildings. These buildings, accessible without mass transit and often closer to employees' homes, will answer both safety and commuting time concerns while still providing teams an opportunity to gather, engage, collaborate and create. While it was born as a survival tactic for CRE through Covid-19, WNH will be part of the next normal.