The new office

Speaker 1 [00:00:02] How long have you been back to the office?

Speaker 2 I've been back for about two months.

Speaker 3 [00:00:06] I think we started in July, 50 percent of the time, so we're there every other day.

Speaker 4 [00:00:12] January. Yes, I mean, I can work from home, but I prefer to come to the office.

Speaker 1 So it's flexible.

Speaker 4 Absolutely.

Speaker 3 [00:00:17] I have a preference for flexibility, because some mornings, some days, I really want to work from home.

Speaker 5 [00:00:23] My company is very supportive and they're not forcing anybody to come in that doesn't feel comfortable. Anybody who's in the office needs to verify their vaccination status.

Speaker 1 Have you noticed any cultural and or visual kind of work changes? Obviously, there are less people, but yeah, anything is striking to you.

Speaker 3 [00:00:44] Well, I am someone who started working on my current job during the pandemic, so you know, I can't really compare the before and the after.

Speaker 6 [00:00:52] One thing I have noticed is a lot of people don't come to the office. It's just been pretty empty. A lot of the spaces are very empty. And I think now they're trying to see if maybe they can save space so they're trying to get us all together in one spot.

Speaker 7 [00:01:06] It's also not a lot of people coming in now. That's really kind of we've got a new, but we bought it right before this pandemic hit. They had bought a new space and it's massive, like a big place. And it's really sad and it’s kind of almost dystopian, you know, like, there's no one in their seats. It's pretty sad.

Mariam Sobh [00:01:23] Welcome to Changing Places brought to you by Avison Young. In Changing Places, we explore our continuing and complex relationships with the built world around us. I'm your host, Mariam Sobh. From Los Angeles to Vancouver to London, workers are putting their sweatpants in the closet, squeezing into their best work clothes and heading out into their offices again for the first time in nearly two years. As we heard in the opening, not everyone is ready or willing to go back to their former work lives. However, companies such as Goldman Sachs are requiring all employees to come back to the office full time. According to the Vancouver Sun, up to 80 percent of workers who experienced work from home life are reluctant to give it up completely. 80 percent. In this episode of Changing Places, we're going to explore what happens when work from home meets office culture, something many of us have had to contend with for almost two years. And if 80 percent of workers want to continue working at home in some capacity, what does it really mean for the future of the office? I'm so happy to have two guests today who can help us unpack and understand the future of the workplace. Our guests are real estate and workplace expert Sheila Botting and James Porter, a market leading consultant with a focus on delivering complex commercial and operational strategies for clients. They will take us through the myriad of changes we've experienced so far and what they believe lies ahead for workers and offices when private and professional spaces collide. Sheila Botting, James Porter. Welcome to Changing Places. Sheila, I want to begin by getting your point of view on how much work in the office versus working from home has changed since 2019.

Sheila Botting [00:02:57] Everything has changed since before the pandemic. You know, I'll call it the before state, before pandemic. People would typically go into the office most days a week, call up four days, five days, whatever it would be for their work product. And the second that the pandemic took place after March 2020, the whole world changed. The world changed that people were able to do their work, their heads down work, their collaborative work, typically from their home or remote locations. Essentially, the world went through the largest change management exercise ever, and because of that, the notion of return to office will be very different. There's, of course, different levels based on different communities and different markets, but it's been anywhere from 10 percent return to office, sort of 40 percent return to office. That's still way less than 2019 before the pandemic.

Mariam Sobh [00:03:55] James, I'd like to get your take on how much work in the office versus working from home has changed since 2019.

James Porter [00:04:02] Yeah, thanks. Well, huge amount of change, whirlwind of changes that COVID brought upon us. The biggest change I can think of speaking to clients out in the market at the moment, is a whole raft of activities that you can undertake at home that actually add to the outcomes of the activities that you're delivering and vice versa. There's a raft of activities that really lend themselves specifically to the office environment. And so that definition of task, and where to get the best outcome for that task, we took for granted pre-COVID, everything happened in the office. And now we're able to sort of segment our weekly and monthly routines of, of activities into locations where’s the best place? Where do I get the best outcome for that task? Is it at home? Is it on the train, on the way in, in the morning doing some emails? Is it at home, one on one or a quiet time for myself to have a bit to think about whatever that activity might be? So that definition we never had previously, but now we're able to apply that definition by location, by task.

Mariam Sobh [00:05:09] What trends are you seeing today as workplaces try to lure people back to physical spaces?

Sheila Botting [00:05:13] Every employer, in fact, every building owner would like the opportunity for people to return to the office more than they have been over the last 18 months or so. So I think that what that means is that employers now say, what do we need to do to have people return to work more frequently? And so our workplace practice is really looking at that lure back to the office. What is the definition of the workplace in the future? Is it the same old traditional office, you know, private office workstation or just become much more of a collaborative team environment? The overall user experience, the experience for the employee to get together with their colleagues and clients and be able to deliver work in a different way.

Mariam Sobh [00:06:00] And then from what you've seen so far? James, how can companies use issues such as collaboration, brand awareness or behavior to lure people back to the workplace?

James Porter [00:06:11] I think I come back to that war on talent piece. I think people are expecting that now. We don't have to look too far as an employee to find out what your peers are doing. Whether that's organizational pace or professional pace, I think people want to put themselves in an environment to succeed, and I think there are some hard metrics around success and what that means in terms of different communications development, collaboration among small teams, among small cohorts, and the business. The organization that you're working for has almost an accountability now to be able to create that environment around you. So that war on talent is critical is not only critical to get that right for the organization themselves, but for the individual looking to be successful in their career. I think they're demanding that from their employees.

Mariam Sobh [00:07:01] Can you explain the fate of the corporate workplace to our listeners?

Sheila Botting [00:07:05] Redefining the corporate workplace becomes the opportunity, certainly for the real estate community and for employers. And you say, what? What does the future look like? How do people want to engage with their culture, with their, with their employer, with their work? And what we're finding, in fact, this trend was well in place long before the pandemic hit, and these new workplaces were designed based on a kit of parts, and that kit of parts would have typically anywhere from 20 to 30 different environments within the workplace. So there would be a batch of focus areas, whether that would be some type of private office or a workstation or a phone booth, whatever that is. In combination with collaborative areas, meeting rooms, teaming areas, pods where people could get together, booths and cafes. Suffice it to say, it's all about collaboration, teaming and employee amenities, and those amenities could include wellness rooms that could include big social digital rooms. It could include a wide variety of opportunities

Mariam Sobh [00:08:10] when you're mentioning amenities. I'm just thinking of all these Big Tech workplaces that were really big on wellness rooms and different things, and then the pandemic hit. Do you think there's going to be a way to rework those types of amenities or will it be back to how it was?

Sheila Botting [00:08:24] I think every employer calibrates that list of amenities to their specific population and the requirements of that population. And so before the pandemic, people were largely in the office for many hours. And so therefore amenities like yoga studios or wellness rooms or whatever it was became very popular so that employees could embrace the combination. Will that take place in a post-pandemic world? I think it's going to take a long time before people return 100 percent back to the office. And so those types of facilities may be released instead. Maybe people can create collaboration areas or teaming areas out of those instead of, instead of a traditional wellness room. But again, I'm only speaking at a very high level. Each organization will need to assess their own requirements in their own marketplace to sort out what the best fit is for that specific requirement.

Mariam Sobh [00:09:21] Well, can you explain the fate of the corporate workplace to our listeners?

James Porter [00:09:24] That's a big one. That's a big one. Mariam, historically you had space because you needed to have it. It was literally almost a liability on your balance sheet and a liability that was slow to react. So something would happen. There would be disruption in the market and you'd end up with vacant space, redundant space, leases that were onerous, et cetera, et cetera. And so the property side of your business was always the laggard. Was always trying to catch up with the front end of your strategy, the front end of your curve in the market. But now that is completely different. So long gone are those, “I'm going to have a strategy for my portfolio of offices,” whether that's in one country or in 20 countries. I've got a portfolio of assets that historically I have a six, seven, eight, 12, 15 year investment cycle on capital budget, refresh, etc. Now that horizon, for most organizations, even the real big ones, is probably no more than 18 months. So the turnaround in these strategies now and the time which these strategies actually run for is so much quicker. Because the pace of the client’s market is so much more fast paced now. They don't know. Big organizations don't know where they're going to be operating. That pace is so much quicker, and so the physical strategy, the portfolio strategy and property strategy has got to be so agile now that it needs to keep up with all of those things. They can't be handcuffs. It needs to have the agility to act as an enabler to allow the organization to respond to its market needs in the way it needs to.

Mariam Sobh [00:11:00] But when it comes to the fate of the corporate workplace James, are there any key takeaways we need to consider?

James Porter [00:11:06] Well, first of all, it's far from dead. I think the importance and the criticality of having a quality environment that enables your business to drive brand awareness, drive the behaviors that it's trying to achieve and enables a great environment for collaboration and outcomes for clients. But there's a lot of organizations, most organizations at the moment trying to take stock and reevaluate what the office space means to them, and that means going back and looking at what their behaviors mean to them and what their cultures mean to them, and what those defined activities are that need to happen in the office space. All those things we’ve taken for granted the last 100 years. Organizations are going through those things. I think what the output, most of those things will be, good quality and an agile working environment, will come back with a vengeance further on down the line.

Mariam Sobh [00:11:57] I want to talk a little bit about office spaces and how they're designed to accelerate the human experience and how that comes into play. We'll take a quick break. We're going to think about that for a moment and we'll be right back. Before we delve into the future of work as a workplace, Changing Places brought to you by Avison Young continues to explore and question our complex relationship with the built world around us. Do you enjoy using your home as an office, commissary and conference room? Do you yearn for a desk in an office with more privacy? Or do you want to return to pre-COVID offices and workspaces without ever using a video conferencing app again? Well, stay tuned for the next portion of Changing Places brought to you by Avison Young. I'm Mariam, so let's continue with our guests Sheila Botting and James Porter. Sheila, before our break, we started to discuss the workplace and the fate of the corporate office. I wonder how office spaces designed to accelerate the human experience come into play, or are they complementary?

Sheila Botting [00:12:55] So every employer and or organization has the opportunity to really pivot toward the employee experience or the human experience. And when you're designing your workplace of the future, you know, you carefully map out what that employee journey is or the user journey. And that includes both the virtual experience, how we are collaborating online together right now, right through to the physical in-office experience. So think about when, when you're in college or university, where you would move from class to class based on the requirement for the day. Well, the same thing could be true for your corporate office, where you may move from a collaborative meeting area with, say, 20 or 30 people through to a small team area, through maybe you want to touch down point with one other colleague, and so you don't necessarily need to have your name assigned to a specific type of function. Rather, it becomes an overall campus environment. That really highlights the experience for the employee. That means you don't get bored sitting in the same cube farm every day. That means you engage with many different people in many different ways.

Mariam Sobh [00:13:58] Well, that campus model sounds good to me. I mean, I'm just thinking about being able to move around and see different people in different departments and talk to two folks and work in different environments. It feels like it would be a lot more creative instead of just sitting in your cubicle.

Sheila Botting [00:14:13] So these new workplaces, if you get them right. Now, obviously it takes a lot of work and research to get them right, and also mistakes. You might try something that may not work and you've got to recalibrate and pivot to something different. But when you get them right, the war for talent becomes everything. One organization that I worked with when they were recruiting in local universities recruited 99 to 98 percent of the people so that they made job offers in a very wildly competitive marketplace. So I think that what that says is the workplace and the design of the workplace and the user experience becomes everything in, in the future of work.

Mariam Sobh [00:14:49] And that sounds like it's a shift from perhaps I don't want to say olden days, but back in the day when it was like, this is the building, you're just going to come work here. Now it's more structured towards what is a comfortable environment.

Sheila Botting [00:15:00] So the before scenario was all about the warehouse of workers, people processing paper from the left to the right of their desk. Imagine downtown anywhere in a North American city, rows and rows of cubicles, and a completely boring experience, right? Typically, none of the space was dedicated to collaboration. To mean, the coffee was dreadful. The workers would never see windows or the light of day. Like everything about it, we’re moving away from that example. Today, what we're doing is we're thinking about making sure that all of us, our colleagues and employees have access to daylight. So gone are the big private window offices, right? We need to see access to daylight. We need fresh air, we need many different work environments, many different settings. We need to cater to my health and wellness. So making sure that I've got an opportunity to walk around during the day. Many organizations are thinking about interconnected staircases that you're walking up and down the stairs or using the base building staircases. So there's many, many opportunities to engage people in the workplace in very different ways from traditional cubicle practice that was in the past.

Mariam Sobh [00:16:08] Is it fair to say that organizations have to be more flexible and there's been sort of a shift where employees now have the upper hand?

James Porter [00:16:15] Oh yes, I think so. I think he's been changing for a number of years now anyway. I think that war on talent. Now that Generation X and Y, which is coming in with a vengeance, I suspect. But that war on talent now is so pronounced in certain sectors. Everyone is playing in a very, very small pool and the ability to attract someone to come and join your business if you can retain that individual for two to three years at the right part of their trajectory in their career. You've done a really, really good job. That's I think that's the reality. Again, I think the days of putting someone in and you keep them for 10 or 12 years or longer, those days have gone. I feel like they've gone, but in reality, they have gone. And actually the flip side of that is, as an employer, you don't necessarily want someone to come in and do 10 or 12 years. There will be exceptions to that. People come in. That's a different journey. Disrupting yourself, having that growth mindset. We've got five people in a team, we've been doing what we've been doing very well for the last five years. What are we missing? What don't we know and how do we go and close that gap?

Mariam Sobh [00:17:22] Well, as someone who's been remote working for a while now, that sounds exciting and I feel like I would go back if there were those kinds of features. Well, I do want to ask you about how you would advise a real estate firm building an office from the ground up. You were mentioning some of these new designs may have fresh air. Open light. Would that be something that you would advise someone building an office for the future? Is there anything else you think would be important to have?

Sheila Botting [00:17:49] Oh, of course, there's a list of amenities that you might consider building in a new building. So if you're a developer, you're thinking about building a base building. So first of all, you wonder if you know, new buildings are much more interesting than some of the old buildings. So the focus on sustainability, net zero, ESG becomes almost the rationale for creating those buildings. And so then you think about the building systems and infrastructure that go behind through, you know, rainwater collection for the gray water, you know, toilets and sinks and things of the building. Right through to wastewater, right through to cooling to be able to do the building heating and ventilation systems. So sustainability becomes one key piece of that net zero tremendous opportunity. Then the physical space is being constructed, and that's where a real partnership develops between the building developer and the tenant or the occupier. And making sure that the creation of both the internal space aligns with the physical building. And so things like technology platforms throughout the building, so you've got wireless connectivity. So technology becomes the next kind of big guiding principle in terms of what these buildings are like. The third part would be around the amenities of the bells and whistles, the key things that would drive the employees to want to work in, in building a b c instead of x y z. And so those amenities would include things like highly animated, activated lobby and public space. So whether that includes the food experience in the lobby or below grade, some type of activation that has regular changes, perhaps with season or particular events. You know, the shopping mall industry got this a long time ago where in the malls I suddenly have all these great programs to get people engaged. You'll see the office building industry pivoting toward that whole opportunity. And then within the building itself, some of the other physical features would be activating the base building staircase. You know, today they're typically dreadful concrete. What would happen if you painted them up and made them the wellness quarter where you can run up and down between the stairs so that you can become physically fit? And there's many other amenities like that that can be inserted into these buildings to make them much more engaging for people than the traditional coupon.

Mariam Sobh [00:20:19] Will employees or employee unions have a say at all in what new offices of the future will look like?

Sheila Botting [00:20:24] So the voice of the employee becomes very important when you start contemplating these future programs to design the physical workplace, and employers that get it right will have specific engagement programs that could include employee surveys, employee focus groups. There's as much learning and development from both the employer and the employee side, so together they come up with the right program in the future. So absolutely, engagement becomes everything. Obviously within a financial framework and envelope so that it's fiscally responsible at the same time.

Mariam Sobh [00:20:58] What would you say that we've entered this new realm of work and a type of freedom that we didn't have before?

Sheila Botting [00:21:05] So the nature of work, worker and workplace has changed forever. As we emerge from COVID and we embrace these fully hybrid, flexible, agile work environments, whatever you want to call them, you know, the notion that I can work anywhere, any time, any place, with anyone, in any way that I want. Is in fact part of the future, it’s part of today. How do I do that? And so on my laptop, every day, I can parachute in and out. Today I've been in London, the U.K., New York and Florida. In Vancouver. You can move anywhere very quickly from your laptop or you can physically go to those places. But the notion that I have a choice about how I go about my business becomes everything. That empowers the employee and is a huge success factor in the war for talent so that employees can then make that choice.

Mariam Sobh [00:21:59] And when it comes to, as we continue to talk sort of about the future, do you think that home offices will eventually become more of a backup instead of a replacement for workspaces? Because I think, early on in the pandemic, there were a lot of conversations about this as the new normal. This is the wave of the future. Now that people know they can work from home, they're never going to want to go back in person. So I guess I'm just kind of wondering, is work from home fleeting rather than a permanent solution for folks?

Sheila Botting [00:22:28] So the first thing is that I would say that one size does not fit all. So what you might want could be very different from what I want. So we can't kind of make the generalization that you're either going to be at home or in the office. But really, it boils down to each individual. But I also think that, you know, life has changed forever. You know, employees are empowered. We have the ability to work anywhere, any time. We're going to exercise our power. And if an employer doesn't allow us to be hybrid, then folks will vote with their feet. And you're seeing that play out right now, where there's a high percentage of people looking for new roles and opportunities as we come out of the pandemic in the war for talent. Hybrid is what is going to win the day and empower employees toward their own decisions and solutions. Obviously within the realm of the business requirements.

Mariam Sobh [00:23:22] And so before we wrap up, are there any workplace trends you think we'll see in the next five years that we haven't touched on already?

Sheila Botting [00:23:30] I think the whole pivot toward the employee experience becomes everything. I know we've talked about the employee experience, but I think now we have to do a deep dive on stakeholder engagement, making sure that as we do things, we're pivoting strongly to what the employees and the folks on the ground really want out of their workplace experience. We want intellectual excitement. We want innovation, we want wellness, we want sustainability, we want it all. So therefore, how can we make sure that we include all of those elements in our future workplace, both virtual and physical? So it's a huge call for employers to actually really carefully think through the value proposition of their organization and their culture for the employees.

James Porter [00:24:16] I think the biggest trend we’ll see is this definition of activity and where best for that activity to be delivered. So whether it's two days a week at the moment we are, we are cutting our time and our working life in the office space. By is two days a week. No, it's 10 days of every month or it's 40 percent of my working time. They are the metrics I keep hearing from organizations. And actually the real metric is, I undertake the right task in the right location, but we haven't found that rhythm and we're not looking at it in that way yet. But at the moment, we haven't got that level of maturity. So we're cutting it quite sort of binary at the moment. It's two days, it's four days, it's three days. But actually, there's a lot more we can do, to segment office time by task. And I suspect that will come into play.

Mariam Sobh [00:25:06] Sheila Botting and James Porter, thank you for taking the time to speak with us today about workplaces and the offices of tomorrow. I, for one, will never look at traditional office space the same way again. And I think that's a good thing. The possibilities surrounding offices for the future are endlessly exciting. Speaking of exciting, we head to Los Angeles, his Little Tokyo and the at&t store at one Powell Street in San Francisco to discuss the current future and trends in dynamic retail experiences. I hope you'll come along for that journey. See places changing and evolving in your neighbourhood. Are you and your team embracing changing environments in your own office space? Share your evolving spaces with us on social media, using the hashtag Changing Places podcast, I am Mariam Sobh, and this is Changing Places brought to you by Avison Young.