The more you know, the better you can prepare for what’s coming—especially when it comes to the future of work.
We may not have a crystal ball, but we have the next best thing.
Lorri Rowlandson is the senior vice president of strategy and innovation at BGIS, a leading global provider of real estate management and facility management services. In a recent webinar, she shared five big corporate real estate trends she predicts will have the greatest impact on your workplace next year.
5 Corporate Real Estate Trends Impacting Your Workplace
1. The War on Talent Will Drive Agile Labor.
We’re already used to on-demand access to transportation, lodging, entertainment and just about everything else.
Corporate real estate leaders have adopted a more on-demand approach to maintenance and even space, to some extent. However, Rowlandson said many have yet to embrace an on-demand approach to talent—and that’s the biggest expense by far.
Consider the 3-30-300 rule. According to JLL, the average company spends:
- $3 per square foot on utilities
- $30 per square foot on space
- $300 per square foot on payroll
At a time when the labor market is tight and highly specialized skills are in high demand, companies are in a bidding war for top talent.
An agile workforce—one that uses contractors or freelancers to supplement full-time staff—can be a competitive advantage.
Also known as a contingent workforce or on-demand workforce, it offers cheaper access to labor, better access to top talent and improved productivity. That said, it’s still more cost-effective to attract and retain top talent than it is to hire someone new.
To win the war for talent, Rowlandson said companies are investing in better workplace design and wellness features that create a more welcoming environment.
What You Can Do Now: Examine the functions in your organization that would benefit from a more agile workforce to get better access to the best skills. And if you aren’t already taking steps to improve your employee experience, you can’t afford to wait any longer.
2. Facilities Managers Will Be Crucial to the Employee Experience.
When it comes to improving the employee experience, facilities managers already play a key role. And as the workplace evolves, that role will involve more customer service.
Need help printing something? Forget your phone charger?
Facilities managers are increasingly stepping in to support employees in a greater capacity, with a focus on maximizing their productivity. They’re more like workplace community managers or ambassadors.
“Think of it as your concierge at work,” Rowlandson said. “They are the eternally cheerful people who greet you and are there to support you with anything you might need.”
What You Can Do Now: Identify the No. 1 barrier to employee productivity in your workplace, and determine how you can resolve it. It could be something as simple as having to leave the office to get good coffee or having a hard time finding a quiet place to work. If you don’t know, ask!
3. Space Will Become a Utility.
For most organizations, commercial real estate is the second-largest expense after labor. As it becomes more expensive, more organizations are using coworking spaces like WeWork.
This “space as a service” model has several advantages:
- It’s cost-effective. Coworking is typically less than half the cost of renting an office space per square foot, Rowlandson said, and the coworking space covers its own maintenance costs.
- It’s faster. You can rent space almost immediately.
- It’s convenient. You don’t have to commit to a long-term lease.
- It offers a good employee experience. Coworking spaces tend to invest in on-site amenities that employees love, like snacks and employee lounges. WeWork is even partnering with lifestyle brands so companies can offer employees local perks like discounted gym memberships and car rentals.
“As we expand in coworking and space becomes a utility, it’s really making us rethink the way real estate services the organization,” Rowlandson said.
What You Can Do Now: Consider where your organization could benefit from coworking. If you have just a handful of employees working in another location, it might make more sense to use a coworking space than to rent out a small office.
4. Technology Will Unleash New Efficiencies.
Whether it’s artificial intelligence, smart buildings, IoT sensors, or new software systems, technology will continue to have a tremendous impact on the way we work.
Rowlandson said she’s seeing companies make the biggest technology investments in the following areas:
- Occupancy utilization technology, including space management software that offers visibility into a company’s corporate real estate portfolio.
- Energy saving technology, including connected lighting systems that help companies achieve greater energy efficiency and manage costs.
- Employee experience technology, including workplace apps that allow employees to find and reserve spaces and get the resources they need to be productive throughout the day.
- Predictive maintenance technology, such as industrial IoT sensors that measure things like temperature and friction to detect potential equipment malfunctions.
While these technologies are making the workplace more efficient, they’re also creating new challenges. For instance, they require organizations to have a good grasp on things like data management and information security. They also come at a cost.
What You Can Do Now: Start small and continue to invest in new workplace technology as it makes sense for your organization. Remember, Rome wasn’t built in a day, but they were laying bricks every hour. And make sure technology expenses are integrated into your capital budget.
“If your smart building investments are competing with capital repairs, your technology investments will always be de-prioritized,” Rowlandson said.
5. Bi-Directional Feedback Will Be More Important.
Social media has given everyone the ability to give feedback on virtually anything, which is incredibly powerful. It’s never been easier for employees to give honest feedback about their workplace through websites like Glassdoor. They can hold organizations accountable and offer creative ideas for improvement. As Rowlandson puts it, “people are the best sensors.”
While the way employees evaluate their workplace has changed, the way the workplace evaluates employees hasn’t evolved much at many organizations.
When many employees desire constant feedback—especially millennial employees— an annual performance review seems incredibly outdated.
What You Can Do Now: Rethink the way you evaluate employee performance. Start by asking two simple questions: What did you accomplish last week? And what are the priorities for this upcoming week?
Make sure you also have a good way for employees to give feedback about their workplace. Don’t make decisions about the workplace without asking employees for input!
Setting up Your Workplace for Success in 2019 and Beyond
Chances are, these five corporate real estate trends are already impacting your workplace in some way. Regardless of your industry or the size of your company, you’re managing space, employees and technology. Having these trends on your radar will help you do that more efficiently while meeting the changing expectations of your workforce.
To learn more about how large global companies like Sodexo, Hershey and Genentech are incorporating the latest corporate real estate trends into their business strategies, check out our Workplace of the Future eBook.