5 Remarkable Corporate Real Estate Trends To Watch This Year
There’s no denying the past year presented incredible challenges. For corporate real estate leaders, however, it also introduced new opportunities to optimize their investments and their use of space.
If you want a winning strategy, keep a close eye on these five corporate real estate trends.
5 corporate real estate trends to watch
The hybrid workplace
About two-thirds of global organizations expect all their employees to have access to an office by the middle of this year. While employees are eager to return, they’ve also become accustomed to working remotely over the past year.
Sixty-seven percent want to split their time between home and the office, according to CBRE’s Future of the Office survey.
More specifically, of the 10,000 employees who responded:
- 10% want to work three or more days in the office
- 29% want to work 2-3 days in the office
- 28% want to work remotely three or more days
- 28% want to be fully remote
- 6% want to work fully in the office
In addition to giving employees greater flexibility to work where they choose, 73% of companies anticipate supporting balanced workstyles. That means allowing employees to work from a variety of different spaces, such as satellite offices, coworking spaces, the company headquarters, and public spaces like cafes.
To keep up with these emerging corporate real estate trends, consider investing in a mix of different property types.
Consulting firm HOK refers to this as the “Hub-Home-Spoke” Model. It’s the idea that as the needs of the workforce change, corporate real estate strategies should adapt accordingly. That means reconsidering the purpose of every space and ensuring it has the right design and amenities to support that purpose.
Not every employee will need to be at your company headquarters every day, but they do need a place to participate in activities that help them feel connected to your mission. They need ongoing training and mentoring, which are often easier to do in person.
And they may also need access to a smaller space close to home (known as the spoke) where they can meet with their project teams to collaborate without a lengthy commute.
Flexible seating strategies
With fewer employees in the office on a daily basis, corporate real estate leaders are also rethinking traditional seating assignments. Only 10% say they plan to have mostly assigned seats when they reopen offices. Instead, 35% will have mostly free address (unassigned) seating, and another 35% will have one-fourth to three-fourths of their seats unassigned.
Like other corporate real estate trends this year, this will have lasting consequences for the future of the office. Many CRE leaders are rethinking traditional cubicles and desks in favor of having a variety of spaces available for employees to claim or reserve.
While free address seating or hot desking allows employees to choose any available seat, they make it difficult to measure occupancy. Using sensors or office hoteling, which allows employees to reserve desks as needed, gives you more effective ways to allocate workspace and plan for the future.
Giving employees greater flexibility around where to work means large corporate headquarters may no longer be as full as they once were. Ninety-eight percent of CRE leaders who responded to the September survey said they anticipated reduced dependence on the office.
As a result, many are re-evaluating corporate real estate leases.
Sixty percent said they were aggressively pursuing contraction, consolidation, and/or exit plans, while 32% said they were renegotiating leases.
Subleasing has also become a more attractive option, especially for executives unable to renegotiate the terms of their current leases. An Ernst & Young survey of CRE executives in September revealed 93% were considering subleasing vacant office space in the coming year.
However, the physical work environment still has a role to play when it comes to attracting and engaging top talent, building a strong company culture, and promoting collaboration.
Instead of investing in 10-15-year leases, many executives are pursuing short-term leases to give their companies more flexibility.
Nearly two-thirds of respondents to the Ernst & Young survey (64%) said they were looking for lease terms of just 3-5 years.
Instead of leasing premium corporate real estate in large metropolitan areas, many are also looking for smaller spaces in the suburbs to better accommodate employees who want to avoid returning to long daily commutes. This tendency toward more flexible leasing is closely tied to the first two corporate real estate trends and will likely continue for years.
It may even be a permanent shift as a result of the pandemic and the new ways of working that emerged during it.
Investing in collaborative technologies
As employees and employers reconsider the role of the office, they are looking for ways to improve collaboration between people in the office and away from it. Corporate real estate leaders are considering investing in new technologies that support these needs to make their office spaces more attractive for occupants.
This includes not only upgrading conference room monitors, speakers, and wireless internet connections, but potentially exploring augmented reality solutions that make virtual and in-person experiences feel more connected.
It also means investing in self-service technology that makes it easy for employees to quickly find what they need to be productive.
Adoption of this corporate real estate trend has been accelerating for years. In a 2018 CBRE survey, 59% of CRE executives said they planned to introduce mobile apps to help employees navigate the office environment more efficiently.
Now, with workforces even more distributed following the pandemic, it’s even more important that they have an easy way to find their colleagues, reserve workspaces, request service or IT support, and receive notifications about mail or visitors.
Investing in mobile apps isn’t just about supporting the employee experience. In large buildings with multiple tenants, these technologies can help corporate real estate leaders manage parking, resources, and chargebacks too.
In this way, the technology adds a layer of intelligence that is comparable to what property managers could gain from a smart building.
Using proptech to optimize portfolios
The volatility of the current economic landscape has made corporate real estate executives even more motivated to minimize risks and maximize returns.
To do this, many are investing in proptech to help them visualize and optimize real estate portfolios.
That includes real estate management software with robust data analytics and solutions that make it easy to manage leases and office moves.
Unlike legacy systems and on-premise IWMS software, which makes it difficult to obtain data when you need it, iOFFICE consolidates data from multiple sources into one mobile platform.
You can see detailed insights, such as:
- Total square footage
- Costs by building, floor, or department
- Occupancy rates
- Lease terms, costs, and expiration dates
Our software also integrates with sensors to give you the most accurate space utilization data.
You can instantly see average occupancy and space utilization across your portfolio over any period of time.
This can help you decide which leases to renew and identify opportunities to consolidate corporate real estate to reduce costs.
It can also help you determine which flexible seating strategy is best for your organization. If you notice fewer than half of your workforce uses the office more than three days a week, you can decide to keep a third of your workspaces assigned and make the rest reservable.
Using the same technology, you can also plan office moves, easily manage move tasks, and keep track of timelines to stay on schedule.
For a large organization, attempting to do all this manually could take months. In a commercial real estate industry that’s constantly changing, you can’t afford to wait that long.
Position your company to adapt to corporate real estate trends
While the past year has shown us no one can predict certain disruptive forces, corporate real estate leaders can adapt to anything with the right strategy and technology.
That means paying close attention to commercial real estate trends like these and investing in solutions that allow you to make changes as quickly as the market changes.
iOFFICE offers a full suite of solutions to support corporate real estate leaders, including software for space management and planning, enterprise move management, lease management, and occupancy sensors that integrate with it all.
By monitoring your company’s own space utilization and making adjustments as needed, you can ensure you’re prepared for anything.
If you’re ready to see a closer look at how our software can help, request a personalized demo today.