Returning to the office during and after the COVID-19 pandemic is a daunting, gigantic business challenge for CEOs and business leaders. The new challenges and dynamics pose hard questions about changing working environments. One result is a clear, indisputable trend toward working from home and fully remote teams. For good reason, too. But, is this the new normal?
The return-to-work response is not simple or straightforward. Working remotely and becoming remote-first has garnered lots of attention and investment. There are clear benefits for workers and teams. Companies have little choice but to embrace remote-first and distributed teams during the pandemic.
But, as the Wall Street Journal highlighted this week, companies are re-thinking WFH and recognizing its costs and negatives, including headwinds for productivity and collaboration, and difficulty onboarding and training new team members.
Where can CEOs and business leaders find shelter in the storm of grappling with this topic? Of course, OSHA's guidance shouldn't be ignored.
Perhaps counterintuitively, commercial real estate owners and management companies are attempting to emerge as a trusted ally. They are offering advice and incentives to aid the return-to-work process.
It is clear these companies have an overt self-interest in facilitating companies' return to the office. This exact self-interest necessitates vigilance, creativity, and being clear-eyed while crafting solutions to help CEOs and businesses face these challenges.
Will it be enough to stem the tide toward permanent remote-first and fully-remote companies? Time will tell.
Let’s take a look at some of the incentives and efforts the commercial real estate community is offering CEOs facing this return-to-work question/challenge.
Indisputably, one of the benefits of working from home for workers has been reduced time, stress, and cost of commuting to the office, particularly when your office is in a city and you’re commuting in from the suburbs. Real estate owners and leasing companies are touting the suburban locations as a compromise -- the benefits of in-person collaboration and mentorship of an office that mitigates some of the taxing aspects of traveling into a congested, far away city center.
Aggressive free rent offers
The velocity of new leases has predictably been hammered during the pandemic as many companies move to remote-first and others delay their medium and long-term planning regarding space for their teams. So, in exchange for signing an agreement with years-long term, commercial owners and brokers are pushing leases with free rent through the rest of 2020 and sometimes even more aggressively than that.
Discounted rental rates Some commercial operators are boasting their offices, particularly suburban locations, offer great amenity packages, ample space to adhere to social distancing requirements, and even the same look and feel as an urban location or original location companies had, pre-COVID, but at a fraction of the price. It will be interesting to see if asking rental rates soften in addition to the upfront free months of rent being offered.
Separate ingress and egress
The reality is most office buildings have multiple tenants with each respective tenants having a multitude of visitors and business dealings. Common areas like lobbies, entrances, and elevators are precisely that: common areas. So, real estate managers and operators are getting creative with things like providing separate direct entrances to workspaces to ensure cramped and shared spaces like elevators, which are obviously highly risky for transmission of coronavirus among other things, are not requisites for ingress and egress. Where the physical building can accommodate such changes, this is a creative solution to enable adherence to social distancing requirements imposed by just about every state in the country.
Turnkey buildouts & custom designed suites
Real estate operators are rolling out the proverbial red carpet to tenants and that means going over and above a commitment to maintaining cleanliness. Often times it means new furniture, new layouts, and expansive tenant improvement investments in everything from carpets to conference tables to redoubling cleaning schedules. The concept of a “six foot” office is well-known at this point of our struggle with coronavirus. Part and parcel, no pun intended, with this concept are things like turnkey buildouts and custom designed and appointed spaces tailored to specific needs and sizes of tenants.
Amenities and outdoor spaces
Building amenities such as a outdoor dining and meeting areas, fitness center and even a conference room are welcomed remedies for workers who have experienced first hand the stressors of cramped working environments while working from home. This hits a chord particularly with parents and households where every adult works a full-time job and childcare has been inadequate or completely absent. Real estate management companies have predictably made a clear commitment to maintaining extremely high standards of cleanliness for these areas. While posing a logistical challenge, it is conceivable that managing such areas can be done, depending on the building’s physical space.
If these offerings are sufficient remedies or will change what seems like an unstoppable trend toward remote-first and remote-only companies is almost beside the point, and certainly will not be determined in a small period of time.
But, what should likely be determined in the coming months is gauging the extent to which CEOs and business leaders trust the advice of commercial real estate operators and management companies as allies on navigating a return to the office. We’ll be watching the trends in occupancy rates, and the newswire to see where, and if, a large-scale return to the office occurs.