What the Rise of Asynchronous Work Means for Office
Technology will be key to help office occupiers better plan space needs as workers shift when and how they use physical work spaces.
As asynchronous work continues to veer toward the norm for many US companies, corporate real estate executives are struggling to nail down their space needs, making leasing increasingly challenging for the office sector.
“A particularly challenging pain point is the discrepancy between how employees say they work in the office and what building and utilization data shows,” says Tony Josipovic, JLL Global Product Management executive director in a new post. “Getting a true benchmark is already challenging and it’s a must have – think of it as a table-stakes.”
Josipovic says the problem with the rise of WFH is that space demand is erratic “and doesn’t necessarily result in a 1:1 seat to worker ratio.” He predicts that phenomenon will continues to grow as asynchronous work is more widely adopted.
A June 2022 report from JLL found that 60% of office-using workers wanted to work in a hybrid environment, with 55% already doing so. JLL experts say employers must thus view physical office space as an enhancement to employees’ workday as opposed to a burden. Enter technology and AI platforms like Envio Systems, which helps aggregate, analyze, and get insights from sensors and other data sources to work toward better assignment and allocation of space.
Recent data from WFH Research suggests the percentage of employees working from home may be stabilizing at just over 30%. An estimate from government survey data before the pandemic placed the trend then at about 10%. But those numbers will still have a big impact on the office sector: another recent analysis from the NYU Stern School of Business and the Columbia University Graduate School of Business predicts big changes in lease revenues, office occupancy, lease renewal rates, lease durations, and market rents” as the result of enduring WFH policies.
“We find a 32% decline in office values in 2020 and 28% in the longer-run, the latter representing a $500 billion value destruction,” they wrote. “Higher quality office buildings were somewhat buffered against these trends due to a flight to quality, while lower quality office buildings see much more dramatic swings. These valuation changes have repercussions for local public finances and financial sector stability.”