Employees Want Workplace Flexibility. That Might Mean a Suburban Location.

Even before COVID-19, flexibility was a focus for companies. 

But Greg Martin, a principal with Avison Young, thinks it has a much more significant meaning now as companies seek to accommodate their employees. 

“Flexibility will stretch longer than just the ‘short term,’ which is why we’re gearing up to see even more movement to suburban locations,” Martin says. 

Martin sees growth in demand for suburban office space as companies seek to provide more flexible work options that many urban buildings may not be able to accommodate. “Downtown office markets will likely soften in the near future with an increase in vacancies, as the traditional downtown tenant [financial and legal] seems to be embracing the work-from-home concept and will seek to implement it into their overall occupancy strategy,” Martin says. “We expect to see an increase in sublease opportunities as well.”

Part of this new office flexibility could come from the hub-and-spoke model. In that setup, the headquarters is in a core location that is accessible to public transportation. The spokes are a dispersed network of offices.

“The hub-and-spoke model has traditionally been used for a salesforce or the more traditional mobile employee roles,” Martin says. 

But these hubs could evolve to meet the needs of staffers who are no longer comfortable traveling into headquarters locations. 

“Going forward, these setups may accommodate some of the traditional headquarters roles that have always been close to the executives and in-house, such as accountants, information technology and data processors,” Martin says. 

Martin says office users will be very selective about these suburban office spaces, preferring locations that are highly amenitized. “It will take more than landlords being flexible on lease terms,” Martin says. “It’s times like these when the location and quality of a building will ultimately attract tenants.”

Martin is seeing office tenants asking for floor plan configurations, indoor/outdoor space and shorter commutes for their employees. He predicts that tenants will gravitate to offices with flexible floorplans, traditional and collaborative workspaces, indoor and outdoor common areas large enough for social distance practices and proximity to a range of dining and shopping amenities.

“Just because suburban employees want to be closer to home doesn’t mean they want to miss out on urban amenities,” Martin says.

As things play out, Martin anticipates a lot of upsizing, downsizing, restructuring and evaluation on the horizon. “While the need for corporate office and corporate culture will remain strong, the way it is used and managed by the tenant may undergo some changes,” he says.

Already, he sees some suburban landlords making changes. “Suburban office owners will start to evaluate their overall operating procedures of their building from cleaning specs to operating hours and services,” Martin says. “Many of the tenants are seeking to accommodate the individual employee needs, and building owners will seek to do the same and to accommodate the tenant.”