As the dust settles in New Zealand, in a Covid world, we are seeing what look to be permanent changes in how people work. Given the surprising productivity of employees working from home, managers are embracing remote working in the long-term. While previous office trends have come and gone, working from home seems to be here to stay. Employees are loving the flexibility, lack of travel time and lessened expense related to commuting, professional clothing and lunches out. What, if anything, can (or should) landlords do to their office space, to retain or gain tenants?
Introducing remote working was an unanticipated development
Prior to the pandemic, we had thought about introducing the ability to work remotely but it never came to fruition. Covid-19 obviously changed that and I was surprised at how seamlessly the transition worked. Why it was not implemented before, can be explained by the fact that real estate has always been seen as a face-to-face business so the idea did not seem like it would be a good fit. However, new technological tools that were introduced over the first lockdown, meant that the industry could not just survive but flourish while people were out of an office environment. A combination of working from home and occasional days in the office seems to be a winning formula.
What are business leaders saying about remote working?
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The quite literal, million dollar question, seems to be whether remote working will continue, not just in the months following lockdown but possibly in years to come. Eventually leases will expire or come up for renewal, and managers and businesses will be asking themselves if they really need all of the space they currently have and how they could potentially cut costs. I have spoken to many other CEOs and Barfoot and Thompson is certainly not in the minority. Industries like banks such as ANZ and communication companies like Vodafone are all doing the same thing. I think that we are all seeing, that as long as you get your work done, it does not matter where you are located. In fact, it is becoming a recruitment talking point, as coveted talent is wanting more options.
Is the concept of an office obsolete?
Offices will always be necessary. They are critical to collaboration and company culture. People feed off each other for ideas and personal interaction. We are keeping ours and other major companies will be too. I think that most managers can confidently go smaller in the future. Remote working is here to stay. However, as part of this, there will be changes to how office space is approached.
Change is in the air
For landlords, there are things that they should consider when wanting to make their office more appealing. Here are some concepts to consider when you want to stand out from the competition:
- Cutting up cavernous spaces into places for multiple businesses to fit, by installing walls and additional entrances, could make a lot of sense.
- Hot desks will become a thing again after falling out of favour. Investing in desks that will allow more than one person to work from them are going to make tenants happy. The same goes for large communal tables.
- Wellness is a key factor for management so investing in air filters and a deep clean of air conditioning and heating systems, will be a great feature to mention to prospective tenants.
- Nobody knows what the future will bring, so body temperature machines, room for social distancing with desks and screens to prevent the transmission of germs, are appealing.
- There are always going to be customer facing jobs. Businesses, especially in retail, want to keep their staff and customers safe and healthy. Reimaging purchase points with permanent protective screens, improved entrance points and sanitation stations, will make these spaces more competitive in an increasingly crowded market.
- Communication is key for retention of tenants and to woo new ones. Owners and salespeople need to ask (and listen intently), to what business owners are seeking in a space, and then be agile enough to adapt.
- Technology is key for remote working, so purchasing items like large flatscreen televisions for conference rooms can be a game changer, when people are deciding between two locations.
- If you have a tenant that you like that is struggling, be willing to negotiate. After all, having a tenant with a discounted rental rate is better than an empty place in a market flooded with commercial properties.
- Chris Dobbie is CEO of Barfoot and Thompson
