3 Things Corporate Real Estate Portfolios Need To Talk About Now And In The Future
In 1963, as we were on the precipice of many years of uncertainty and strife to come, legendary musician Bob Dylan wrote the song “The Times They Are a-Changin.” The song, which was an anthem for change, really understood that culture was truly downstream from politics. Fast forward to 2020 and the complete change of the world, and especially the work world as we always had known it to be. Pandora’s box had been opened and a two-year alpha test for “remote work” had begun. The world needed to keep moving, and despite turbulent times, it did, and quite successfully, on the work-from-home front. Sure, we were not devoid of problems, but somehow, we always seemed to work them out through trial and error.
The world went on and all was good, until it was time to go back, and it wasn’t. Office spaces were being paid for and not used, and it became quickly apparent work was falling off with some teams as in-person bonding rituals had stopped or were also remote. Not to mention, quality and quantity of work had fallen off and appropriate dress and the willingness to even meet on camera was a heavy point of contention. Lastly, some people are great employees, they just need people, or at least some of the time. And the battle thus began as a great many of us performed at not only higher levels but were happier than we were before.
Then, as Anthony Klotz coined in 2021, “The Great Resignation” began and people began to rethink work, life, and exactly how much power a company should dictate over their lives. Soon enough people were saving more money, spending more time with families, had lower stress and better mental health, and had the ability to once again feel a sense of empowerment. However, many who had built businesses were at the mercy of the court and the visions they worked so hard to achieve were not theirs anymore in many cases. The even bigger problem was surrounding areas were losing a ton of foot traffic for their businesses and cities were becoming ghost towns. As we all can agree, in order to have an economy we need participants. Also, in order to have profitable businesses, we also need standards and happy employees. At the end of the day, we need to remember we took a job that was not a democracy, but hopefully a well-governed meritocracy. The great thing about America is you can always start your own business.
The pathway forward will most definitely be a marathon and not a sprint by any means. Socially, financially, politically, etc. The fact is whether a business owner or an employee, we need each other, and more importantly, we need to start somewhere.
1. No, the entire office does not need to be there.
Unless it’s manual labor or hands-on, you can do it remotely. You don’t need in-person; you need better KPIs and analytics management. You can’t manage what you can’t measure, and you need to know how to measure and understand what you are looking at. Not only will your employees be more productive and have less anxiety and knowledge of how to improve, but your managers will get stronger to become more effective leaders and mentors. You are locked into that lease regardless, so unless you have a way out you are paying the piper. Let it go.
2. You need to analyze office utilization.
Just like people learn differently, they work differently. Some people love the office, some people hate it, and some people can take it or leave it. Embrace your workforce, they will thank you for it, and you will open the doorway to beginning to save some money for better margins, employee retreats, better training, and not to mention a wider and more diverse talent pool of the best to get the best.
3. Analyze your leases, every year. Yes, all of them.
Once you understand your workforce, you will be able to make your next moves. How big of an office do you really need? Once you know who’s using it and how they use it you can get to work. Can you get out of your lease and what is the cost opportunity? Can you sublease? Can you dispose? Can and how should you transform what you have?
In conclusion, the world will not change overnight, although our 2020 experiment proved that wrong. But it can change, and it can change for the better. The most important thing is to get started, to plan efficiently and effectively, and to plan together. Power with as opposed to power over is what truly changes the world. What will you choose?