Dive Brief:
- More than 60% of commercial real estate operators expect increased workplace utilization over the next five years, despite facing challenges in long-term planning, according to JLL’s 2024 Future of Work Survey.
- While hybrid work was previously believed to be a key to attracting talent, the momentum is now shifting toward office-based work, JLL says. Its survey of 2,300 commercial real estate decision-makers found that 44% of organizations would like to see staff in the office five days a week, compared with the 34% of employees working full-time on-site in 2022.
- Despite a gap between employer expectations and what is happening in reality, CRE leaders must evaluate if the return-to-office momentum will persist and what that means for office utilization, JLL says. Organizations must also consider how space design can accommodate various work styles, such as full-time attendance for certain teams and hybrid schedules for others, per the report.
Dive Insight:
The remaining 56% of respondents surveyed are “hybrid adopters” with strategies that range from fully remote to requiring at least three days a week in the office, the report says. Forty-three percent of organizations expect the number of days in office to increase by 2030, though this may still be within a hybrid workplace strategy for many, the report notes.
The type and location of an organization exerts an influence on workplace style, according to the report. Large organizations in Europe, the Middle East and Africa with over 10,000 employees are more likely to adopt hybrid models, while small- to medium-sized companies with between 1,000 and 9,999 employees based in the Asia-Pacific region or the Americas tend to favor in-office work five days a week, JLL says.
Despite tight job markets and the rise of AI and automation, 64% of respondents said they expect their company headcounts to grow by 2030. Due to growth projections and office attendance policies, more than half of respondents expect their total footprint to increase over the next five years, according to the survey. Eighty-five percent of organizations have a policy of at least three days of in-office attendance per week, JLL says.
Six factors are driving the need for a change in workplace strategies for commercial real estate leaders to meet evolving organizational needs, per the report. These include a desire to increase and rebalance organizational headcounts; a strong focus on organizational efficiency that involves making informed long-term investment decisions; competing visions on how work should be done to achieve the best performance; and an opportunity for CRE teams to contribute to the “employee value proposition” by defining a compelling and evolutionary office model for their organization, JLL says. Further, office advocates are attempting to promote equal work practices among their workforce, while hybrid adopters are recognizing that flexibility in workstyles is the best way to strengthen organizational performance, according to the report.
Hybrid workplace models appealed more to organizations in the e-commerce, energy and renewables, technology and life sciences sectors, while office advocates were largely in customer-facing industries or those where a large proportion of non-office staff works on-site, such as healthcare, retail and manufacturing, the report says. The preference for in-office work among office advocates suggests these organizations “do not want disparity in work practices — management at home and workers on the shop floor — and are using office-based working to build solidarity across the whole workforce,” JLL says.
The difference in workstyles translates into different approaches to the workplace, with office advocates making a concerted effort to address diverse workplace needs, including accessibility and generational requirements. Those that want to see employees in-office five days a week are also more likely to pay a premium to occupy buildings with leading health and wellbeing credentials, “demonstrating higher readiness to invest in the provision of high workplace experience standards,” JLL says.
To increase office space utilization, 39% of organizations said they could envision offering different pay and benefits to employees who attend the office regularly versus those who work remotely. Meanwhile, 37% said they could consider providing a network of additional workspaces closer to where people live. Alternatively, one-third of respondents said they could see their organizations going completely remote by 2030, with no office space at all, instead relying on virtual spaces and team building events.
JLL says this range of possibilities signals that organizations are still uncertain about the best approach to workplace strategies and that many options are still under consideration. Due to this, commercial real estate decision-makers find it difficult to focus on long-term goals, with 41% of respondents reporting challenges with thinking and investing for the future, JLL says.
