Growth of serviced office market doesn’t mean it has bounced back

Growth of serviced office market doesn’t mean it has bounced back

An analysis of the UK serviced office market from Sirius Property Finance, claims that while the sector is set to grow by 17 percent in 2023, a growing acceptance of remote working means it is still struggling to match its pre-pandemic highs.An analysis of the UK serviced office market from Sirius Property Finance, claims that while the sector is set to grow by 17 percent in 2023, a growing appetite for remote working means it is still struggling to match its pre-pandemic highs. More →

Office lease lengths may be decreasing but majority of firms will increase their footprint

Office lease lengths may be decreasing but majority of firms will increase their footprint

office lease lengths has fallen to the lowest on record and that vacancies rates had soared, office designers Unispace are suggesting firms should be wary of making 'rash decisions' regarding their office footprintResponding to reports from property management platform, Re-Leased, that UK office lease lengths has fallen to the lowest on record and that vacancies rates had soared, office designers Unispace are suggesting firms should be wary of making ‘rash decisions’ regarding their office footprint over the long term. A study published by the firm – Returning for Good – which surveyed 9,500 employees and 6,650 employers from 17 countries worldwide – claims that while employees in the UK spend the least amount of time in the office compared to any other country, there is an expectation that this will increase as workers face limited access to career progression opportunities while working remotely. More →

Global prime office rents rise for second continuous quarter – Savills

Global prime office rents rise for second continuous quarter – Savills

An international real estate advisor says the fact that prime office rents are continuing to edge up demonstrates that demand is thereSavills latest global Prime Office Costs (SPOC) analysis claims that net effective costs for occupiers taking top quality office space in key cities around the world rose 0.3 percent in Q2, following a rise of 1.1 percent in Q1. The international real estate advisor says the fact that prime office rents are continuing to edge up demonstrates that tenant demand is still present and landlords are cautiously optimistic in some markets. More →

UK government plans to parachute AI experts into departments to ‘turbocharge’ productivity

UK government plans to parachute AI experts into departments to ‘turbocharge’ productivity

So-called 'digital gurus' from the private sector will be 'parachuted' into government departments as part of radical plans to 'turbocharge' the technological and AI skills of civil servantsSo-called ‘digital gurus’ from the private sector will be ‘parachuted’ into government departments as part of radical plans to ‘turbocharge’ the technological skills of civil servants, Cabinet Office Minister Jeremy Quin has announced. Delivering a speech at the think tank Policy Exchange, Minister Quin set out a number of measures which he claims will drive forward the government’s plans to harness innovation and technology including AI to make Whitehall run more efficiently.

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Office landlords take efficiency-boosting measures to cut energy costs

Office landlords take efficiency-boosting measures to cut energy costs

A new poll of 250 office landlords from infintSpace and Instant Group claims to have identified the most widely used energy saving measuresA new poll of 250 office landlords from infinitSpace and Instant Group claims to have identified the most widely used energy saving measures at their properties.  The study set out to identify which energy-saving measures are the most widely used and which landlords are prioritising in the years ahead as ambitions for a net-zero commercial real estate sector become increasingly focused. More →

City dwellers take advantage of hybrid working to relocate to suburbs, towns and countryside

City dwellers take advantage of hybrid working to relocate to suburbs, towns and countryside

A new report claims that suburbs and small towns across are booming, as people take advantage of hybrid working to migrate from larger citiesA new report from IWG claims that suburbs, small towns and rural areas across the US and UK are booming, as people take advantage of hybrid working to migrate from larger cities. The study, undertaken in partnership with Arup, suggests that an estimated 500,000 people will leave US cities this year – 59 percent higher than pre-2020 levels – with most moving to suburbs, revitalised former dormitory towns and rural areas. Similarly, outbound migration across the UK is continuing at a faster rate than pre-pandemic levels, and there is strong evidence that suburbs and small towns have higher levels of economic activity than before 2020. More →

Embrace the chaos: the office must find a new purpose, conference concludes

Embrace the chaos: the office must find a new purpose, conference concludes

The British Council for Offices (BCO) annual conference, this year hosted in Dublin, addressed the purpose of the office in the context of the evolving world of work

What is the purpose of the office? That was the central question at this year’s British Council for Offices (BCO) conference which took place in Dublin. A big ask.

Nonetheless, the speakers and delegates that arrived in Dublin were up for the task. In the opening address, BCO senior VP & conference chair Despina Katsikakis promised delegates the conference would explore and untangle the intricate elements of the ecosystem that must seamlessly merge tech-led work, play and… well, survival. The focus of the two-day event (or three for those who like golf) was to devise strategies to design, build and manage vibrant and inspiring workplaces that foster the wellbeing and advancement of the individuals and communities they serve, all while promoting social, economic, and environmental sustainability.

As one would perhaps expect from a BCO conference, several speakers made a case for the office, including Davina Saint, director of the Irish National Assets Management Agency. Nobody relates naturally with screens or virtual protocols, she said, so we need to embrace the idea of social capital: “It makes organisations go around,” she said. “It’s the electricity in the machine. The shift to remote working has dented social capital. There’s less connection and more isolation. Productivity and innovation have also taken a dive.”

“I believe strongly in the office,” said Niall Gaffney, CEO of Ireland’s largest office landlord IPUT, during the developer’s panel. Fellow panellist Kevin Nowlan, senior advisor to Hibernia Real Estate Group, agreed: “Culture and life comes from people being and working together.” The workplace will play a key role in reinventing cities, they chimed in unison. Why? “Because the office is where the magic and inspiration happen,” Saint said. “It’s where the social heart of an organisation can beat.”

As the audience were reminded throughout the conference, many people meet their partners at work

But it goes beyond business. As the audience were reminded throughout the conference, many people meet their partners at work. If marriages are born out of proximity rather than heaven, perhaps that means there will be fewer weddings, fewer children. That musing may well prompt a shrug in response but it’s worth noting there’s already a dwindling workforce. Yes, borders are clamping shut, but it may also be because people aren’t having children as often as they used to. Last year, the Financial Times, citing Office for National Statistics data, revealed that the “natural population of the UK will begin to decline by the middle of the decade, leaving the country dependent on migration to increase the working-age population”. But freedom of movement is not so free anymore. Dublin, we have a problem.

 

Stupid cupid

While it might not be up to workplace professionals to channel their inner cupids, you can bet your bottom dollar the population crisis will be on future BCO conference agendas. Until then, however, there’s a more relatable challenge in play. The industry needs to focus on the role of the office in a rapidly changing world. Bill Hughes, global head of real assets at Legal & General Investment Management, looked at the old and new definitions of an office. The traditional definition is “a room or set of rooms in which business, professional duties, clerical work are carried out”. Today, it’s where important face-to-face interactions and teamwork happens. It’s where culture is built. “It’s where knowledge transfer and learning through osmosis occurs,” Hughes said. “It’s about energy and having fun.”

The future of the world of work is an obsession for bosses

“The future of the world of work is an obsession for my bosses,” the BBC journalist Simon Jack said, during the ‘business of politics’ discussion. “Because it “affects the lives and livelihoods of our audience.” And that’s perhaps why there’s so much focus on the employee experience. Billions have been spent on the customer experience. Many of the speakers stressed that it’s time we do the same with the employee experience.

In a session on the purpose of place, Andy McBain, head of future of workspace & design at NatWest, shared that the bank’s workplace strategy focuses on experience, events and an element of experimentation. But experience can’t be a fluffy add-on, he suggested. It must be measured and tracked if it’s to evolve and deliver ultimate impact. To that end, McBain’s team uses Audiem, an advanced employee feedback analytics tool, that allows heads of real estate not only to get the flagship quantitative scores that they need to track and manage performance but also dive deep into the qualitative data, helping them understand the drivers behind satisfaction at a granular level. “It’s allowing us to develop specific approaches we know directly addresses employee concerns because we can see what they’ve said about it and how it’s affecting them,” said McBain.

Vernon Blunt, head of global workplace operations at Ericsson, and Paul Casey, global real estate EMEA director at IBM, agreed that hybrid is here to stay, though the jury’s out when it comes to the effectiveness of mandates. While employee experience remains the focus, cost-cutting is coming to the fore because for the CFO must be kept as happy as the CPO. It’s a cost and experience juggling exercise. There also seems to be less focus on how to get people back to the office, but more energy going into how to self-organise around the busy days.

These occupiers want and demand more flexibility and shorter leases. Rob Harris of Ramidus Consulting urged that contract and service level agreements need to change to become more flexible, especially for SMEs who he called the “growth engine of the economy”. There’s also a recognition that there might be too much space. Avison Young’s Nick Axford highlighted that one third of office space could be re-used for community initiatives, but the infrastructure isn’t yet there to make this happen. Also calling for a systemic transition was Indy Johar, co-founder of Architecture 00. “Forget about building new workplaces, we need to build a new UK,” he said.

The conference delved into workplace design, management and communication principles that foster culture, health and wellness, and collaboration. During various sessions, speakers and attendees examined the strategies employed by occupiers in their quest to navigate the challenges of the present and forge a path towards a better future. We have a long way to go on that front, but the will is there.

The retrofit of commercial property should be prioritised over new buildings

The retrofit of commercial property should be prioritised over new buildings

A retrofit first principle is advocated in a new reportA retrofit first principle is advocated in a new report, Transform & Renew – Making non-domestic buildings fit for a low carbon future from building consultancy Mace. That and other recommendations set out in the report aim to promote the re-use and repurposing of existing non-domestic buildings which make up about an eighth of total UK building stock but account for a quarter of its carbon emissions. More than 3.5m such buildings require retrofit in the next ten years, Mace suggests in the report. More →

Corporate real estate strategies are now people centric focused on new ways of working

Corporate real estate strategies are now people centric focused on new ways of working

Corporate real estate decision-making and people-centric strategies are becoming more integratedCorporate real estate decision-making and people-centric strategies are becoming more integrated, according to CBRE’s 2023 European Occupier Survey. The report claims that 68 percent of organisations have partnered across multiple business functions including HR, IT and Communications when implementing workplace change strategies, indicating the importance of real estate decisions at a corporate level. More →

Flexible working means large firms plan to work with less but better office space

Flexible working means large firms plan to work with less but better office space

Around half of the world’s larger multinationals are planning to cut back on their office estate in response to the rise of hybrid and flexible workingAround half of the world’s larger multinationals are planning to cut back on their office estate in response to the rise of flexible and hybrid working, according to a new report from Knight Frank. According to the study, 50 percent of employers with more than 50,000 staff worldwide will reduce their office space by between 10 and 20 percent over the next three years. However smaller firms are set to increase their demand for office space according to the real estate advisor. More →

Office refurbishments rise to all time high in London

Office refurbishments rise to all time high in London

The volume of all London projects including both office refurbishments and new space is up by almost 80 percent, with the West End continuing to lead the wayAccording to the latest London Office Crane Survey from Deloitte, London has seen the highest volume of new office refurbishments since records began in 2005, with 37 new schemes covering 3.2 million sq. ft. The volume of all projects including both office refurbishments and new space is up by almost 80 percent, with the West End continuing to lead the way. The report claims that over 10 million sq. ft. is now projected to be delivered during 2023, with this year on track to catch-up after several years of disruption. More →

Hybrid working, work from anywhere and the evolution of the Third Place

Hybrid working, work from anywhere and the evolution of the Third Place

Two people working separately in neighbouring booths in an office to illustrate the principle of third place facilities in hybrid working cultures. The restrictions brought about by COVID-19 altered where we work and thus also how, when and through which channels we do work related activities. These changes radically altered the way previously office-based workers thought about ‘work’ as an activity. This new era of hybrid working had a significant impact on traditional models of workplace provisioning. One could argue that pre-COVID-19 the ‘work mindset’ was almost an afterthought because there were distinguishing markers that indicated when you were expected to work and when you were not. If you were in the office, then you were expected to be doing work-related tasks. Then, at the literal end of the day, you switched off your computer and went home and mentally ‘turned-off’ until you returned to work the next morning. More →