Summary List Placement
Now that corporate giants like Apple, Goldman Sachs, and Google are calling most employees back to the office, America stands on the precipice of a mass return to in-person work.
For the last 15 months, design experts and business leaders have speculated on what the office of the future will look like, scrutinized how other countries are handling their post-pandemic returns, and agonized over remote-work burnout and the need for in-person interaction.
The latest prediction: Companies will only need 9% less office space per employee, while the pandemic-fueled downturn in office rents and the uptick in vacancies will end by 2025, according to a new study by CBRE, the world’s largest commercial real estate services and brokerage firm. It’s impossible to know exactly how’ new hybrid work models will actually affect companies’ need for physical workspaces — and the US office real-estate market more broadly — but CBRE’s forecast is both the most recent and most specific analysis so far.
The data comes from CBRE’s latest econometrics report, a 15-page document sent to clients that draws its conclusions from a survey of 185 companies of all sizes that the firm conducted among its office-space occupiers this spring.
CBRE found that most companies are expecting employees, on average, to spend 24% less time in the office. Most also said they are planning to return to the office in the third and fourth quarters of 2021.
This lower — but not substantially lower — demand per employee and return timeline has led CBRE to project that the office market’s recovery from the pandemic won’t look too different from what happened after both the 2008 global financial crisis and the 2001 dot-com crisis.
“The office market is going to continue to be challenged because we’re emerging from a recession, and as normally happens, the office market altered in the recession,” Julie Whelan, CBRE’s head of occupier research, told Insider. “But we do believe that we are going to recover from an office standpoint in line with past real-estate cycles.”
Whelan, along with CBRE’s research director and senior economist Matt Vance, walked Insider through a deck with the findings and conclusions of the occupier survey and econometrics report.
Making the impact of the pandemic on in-person work seem minimal does, to be sure, align with the business interests of CBRE, which both leases and manages office space. But taken together, these studies offer ample evidence for the argument that the most recent crisis won’t spell the death of the office despite the rise of remote and hybrid work.
We’ve selected three slides from the deck that best illustrate the firm’s reasoning.
1. This slide explains how CBRE was able to turn the expectation that more employees will work remotely from now on into a concrete estimate of how that will affect demand for office space.
CBRE’s survey of office occupiers showed that even though many companies are adopting hybrid models, workers will still be tethered to a physical office. Only 4% of companies surveyed said that they …read more
Source:: Business Insider