Bracing for pain… And preparing for opportunity

I saw an CFO survey from Gartner discussing how many of their employees they plan to move to permanent remote work. The numbers are significant. 75% of the survey respondents suggest that at least some portion of their staff will work remotely, even after the shelter-in-place order are lifted. It’s clear that CFOs are looking at this as an opportunity to press cost-cutting initiatives around reducing facilities costs.

There has been a lot of talk within the corporate real estate industry that WFH (Work From Home) won’t stick once we get through the Covid-19 crisis. And as a real estate broker that makes my living based on demand for real estate, it’s a nice narrative to believe.

As much as we want to believe that we’ll all be returning to the status quo once we get through this, I get the sense that nothing will ever be like it was. We’ll never get back to “normal” again.

While this will reduce overall demand for office space, it also creates a terrific opportunity for landlords that are willing to offer exceptional workplaces for the employees that are still going into an office environment.

Landlords that are prepared to offer well amenitized buildings will be able to compete aggressively for these tenants. I predict that tenants are going to be looking for buildings that offer strong infrastructure including quality air filtering technology, strong building management and cleaning services, the ability to construct high quality offices (not just open bullpen environments) significant food options and large spacious conferencing centers.

Owners that invest early in their properties and then do a good job of marketing these improvements will be well positioned to take advantage as CFOs, in partnership with their HR chiefs, revisit their office requirements.