January 02, 2021
Corporate Real Estate.
Four property strategies for corporates to consider in 2021
Here are the four new property strategies to consider when procuring office space.
JOHNSON CORNER 50 Devon Street West in New Plymouth City
At the beginning of the Covid-19 Pandemic, many corporates implemented work-from-home policies as a collective response to stop the virus from spreading. As the lockdown was lifted, business leaders started studying new work trends, speak to their employees, and re-evaluate their business operations. This led to four emerging trends that corporate real estate leaders can consider when procuring office space.
When Pfizer reported that their vaccine is 95% safe, it bolstered confidence around the world that soon humanity will return to a new normal with less vitality and will have an opportunity to focus on solving hard and complex problems for the betterment of humankind.
As the lockdown was lifted in New Zealand, it quickly became evident that a permanent work from home model is not sustainable for small and large businesses. Global trends also suggested that employees were struggling to collaborate, innovate, and connect.
As we look forward to a protected population (from Covid-19) due to the vaccination, the question for business leaders is; how to find solutions that satisfy their team's unique needs?
The future of work is gearing up to be flexible, and property strategy is likely to be shaped by corporates using a unique combination of the below trends:
de-densified headquarters: A model that reconfigures a company's original office space to accommodate physical distancing.
decentralised satellite offices: A 'hub-and-spoke' model that provides employees with satellite offices closer to their homes to avoid long commutes and collaborate safely in small groups.
work from and near home: Providing employees with professional workspaces closer to their homes who can't access safe and productive workspace at home. This model optimises individual productivity for employees.
collaboration and in-person hubs: A strategy that shifts the purpose of a company's original office or procurement of a move-in ready office to primarily host intentional, collaborative activities.
At JOHNSON CORNER, we believe these models and strategies' ultimate goal is to give employees the flexibility to access different environments to conduct different types of work where outcome-driven productivity is high and sustainable. JOHNSON CORNER's Enterprise Solution is designed to work with enterprises nationwide, providing access to move-in ready offices on an ongoing basis.
By giving employees this flexibility, business leaders will help reduce negative effects that full-time remote work has had on many working professionals. A recent Oracle and Workplace Intelligence Global Survey found that most employees had felt that remote working due to the Pandemic had harmed their mental health.
1. De-densified headquarters
This model recommends reconfiguration of a company's original office space (headquarters) to allow for safe physical distancing in the office.
During the lockdown, the work-from-and-near-home (WFNH) model proved successful for carrying out individual tasks. When the lockdown was lifted, employers started planning for the return to the office:
return employees in groups, prioritising employees that are productive in-person and through collaboration
increase office space per square metre, per employee, to allow for safe physical distancing
allow employees to work-from-home for a few days to conduct individual tasks
allow employees to work-near-home to reduce long commutes and collaboration in small groups by accessing move-in ready, flexible offices
When the return to the office was complete, business leaders started to explore what the future of work might look like for their employees and how can that be aligned with their office procurement strategy. Here are are the emerging trends:
As additional space in the original office became available, some businesses (examples) shifted headquarter's purpose into space for in-person meetings, collaboration, and innovation activities.
Some sub-leased additional space that was not required
Some started the process of exiting from their traditional lease and started procuring a combination of move-in ready office suite (as their headquarters) and distributed satellite offices
This model is emerging to be robust as it provides flexibility during a volatile period until the successful rollout of vaccination. It allows for constantly reviewing the office space requirements and working with JOHNSON CORNER using the hun-and-spoke model to access office space nationwide and overseas as and when required.
With this model, businesses can reduce their commercial cost by accessing the amount of space they need, remain agile as they continue assessing their employees' needs, regularly. This model provides a sustainable way of scaling office space efficiently.
2. Decentralised satellite offices
This is a 'hub-and-spoke' model that provides employees with satellite offices closer to their homes to avoid long commutes and collaborate safely in small groups.
This model best suits to businesses that want to continue with normal operations but is not equipped to provide workspace to its employees that prioritised safety and collaboration while keeping costs down.
A business can quickly move from one central headquarters to several temporary satellite offices across the company's primary city or the country or different cities in different countries with a hub-and-spoke model. This gives employees reduced commute times, more space for social distancing and room to continue collaborative in-person work as needed.
Working with JOHNSON CORNER, businesses can strategise their decentralised office footprint on an ongoing basis, and access new locations very quickly, as and when needed.
3. Work from and near home
This model provides employees with professional workspaces closer to their homes who can't access safe and productive workspace at home. This model optimises individual productivity for employees.
As work-from-home experiments proved that employees could achieve productivity for individualised tasks, employers started to explore solutions that could provide a solution that covered all scenarios;
Some employees are productive at home
Some employees are productive in professional workspaces
Most employees prefer avoiding long commutes
In-person collaboration works best for intentional meetings and collaborative activities
Working with JOHNSON CORNER is the way to go. Together, design a work-from-and-near home solution for all employees that are not working from the company headquarters. With such a solution, a business can offer passes to its employees to utilise serviced office spaces as and when they require.
This model empowers employees to choose which office space to visit for work, depending on location or which team they are collaborating with at that time, enabling geographical convenience and safety while facilitating space for productive, focused work.
4. Collaboration & in-person hubs
This strategy shifts the purpose of a company's original office or recommends procurement of a move-in ready office to primarily host intentional collaborative and in-person activities.
Now is the time to consider reimagining the role of the original office or headquarters. Many businesses are already reconfiguring their headquarters for intentional, socially distanced collaboration among employees: fewer workstations and more collaborative spaces.
Our recommended solution is to partner with a serviced office space provider to provide employees with a hybrid solution - reconfiguring the old office space with a mix of 'active' ad 'focus' areas, and creating physical spaces for different work styles and project needs.
This model enables employees to work from home for individualised tasks and returning to the headquarters or a new temporary space for productive meetings and in-person group activities that foster innovation, teamwork, and culture.
What to consider when re-imagining your corporate property portfolio?
Where to start? How to implement your new corporate property portfolio with structure? Companies will constantly have to adjust and optimise the amount, usage and location of their spaces on a regular basis.
Property strategy to reflect company priorities: Start with what the priorities of the company are and ensure they are reflected in the property strategy. Emerging priorities for 2021 are: redirecting capital investments allocated to traditional build property, reducing the risk associated with long-term leases, introducing operational efficiency with smart property portfolio design, and focusing on needs of the employees.
Make data-driven decisions: Make decisions based on data already available. Evidence-based decision making will help stabilise annual property budget per employee, cap up-front capital investment, measure lease obligations, total workstations, utilisation, fixed and variable expenses, square metre per employee, and employee satisfaction.
Forecast property needs for one to two years: Most businesses forecast property needs in 10-year cycles, however, the employee headcount forecasting is shorter. With flexible property, a business can estimate property budgeting and headcount growth just one to two years out.
Gather regular employee feedback: Understanding employee challenges and preferences, businesses can empower their employees to do their best work. Conduct regular surveys and design thinking workshop to learn more about employee challenges and preferences.
Use a mixture of office space options: businesses should seriously consider using a mixture of space options, including long- and short-term offices, on-demand offices and working from their homes. Business leaders can now bundle these variations when rebuilding their portfolios for maximum flexibility.
Explore flexible deal structures: Explore deal structures where allowance to transfer financial obligations from one building to another. This would make the hub-and-spoke model, allowing businesses to adjust their ‘spokes’ throughout a city, or across New Zealand on a periodic basis.
No matter what new property strategy direction your company is looking to take, JOHNSON CORNER is a small but ambitious company with a deep understanding of the modern enterprise. It is acquiring new space in partnership with commercial property developers and owners to meet the needs of all enterprises. This new year is the perfect time to plan for the future of work for your company is now.