June 19, 2025
The pace of office downsizing appears to be slowing to a stop
A new report from Leesman claims that the sharp reductions in office space seen in last five years may now be levelling off. According to the Focus Forward study, which draws on data from 132 senior corporate real estate (CRE) leaders worldwide, the majority of organisations have already reduced their real estate footprint – but the pace of office downsizing is slowing. The report states that 68 percent of organisations surveyed had downsized over the previous 18 months. However, only 49 percent said they intended to reduce space in the next 18 months. Of those, just 11 percent anticipated what the report refers to as “considerable” reductions.
Leesman concludes that while downsizing remains a common strategy, the figures suggest that many organisations have now completed or nearly completed this process. One-third of respondents said they expect their footprint to remain the same in the near future.
Focus shifts to targeted optimisation
The report indicates that among organisations planning to reduce further, the most frequently cited strategy is not renewing expiring leases, selected by 63 percent of respondents. Other common approaches include subleasing space (60 percent) and actively surrendering leases (55 percent). Direct property sales are less common, with 26 percent reporting plans to sell buildings and 11 percent exploring sale-and-leaseback options.
For the small proportion of organisations planning to expand, Leesman notes that long- and medium-term leasing remain the preferred routes. A quarter of these respondents also reported plans to partner with coworking or third space providers, despite a broader decline in individual employee use of such spaces.
The report suggests that decisions about office retention are increasingly influenced by the quality of space. According to the data, 62 percent of respondents said that workplace quality either “significantly” or “considerably” affected decisions about which spaces to retain or release.
Real estate still under review
Leesman reports that in total, 74 percent of organisations have either already reduced their footprint, intend to do so, or both. However, it concludes that “the reductions are slowing down” and that the more dramatic real estate changes prompted by the pandemic may already have occurred.
The report positions this trend as part of a broader shift toward strategic optimisation, rather than further wholesale cuts. It also highlights that the employee experience remains central to ongoing decisions, with several respondents identifying a focus on “balancing cost with quality” as a key priority.
