As stay-at-home restrictions are being lifted, office workers returning to the workplace may come back to a much different environment.
Prior to the pandemic, offices were moving towards less square feet per employee, creating some of the most dense open office layouts of all time. But as physical distancing becomes of utmost importance, companies will need to create an environment that is safe for employees to return to. That is why it is likely that office space demand could increase.
On the other hand, a Gartner survey found that nearly three-quarters of CFOs agreed that they would move at least 5% of their workers to remote working positions permanently, which could result in less office usage.
Still, offices could be seen as an amenity rather than a necessity for many companies. This could likely lead to a boost in suburban office space as people want to avoid the densely packed, expensive city life. Suburban office workers will be able to commute easier and spend less per square foot on their space.
Shared workspaces have been largely vacant since the beginning of the pandemic, but in the long-run, expect to see these spaces increase in popularity. Although many of them are associated with tightly packed environments, operators will opt to create more space for their tenants. Additionally, coworking members will have the opportunity to sign a short-term, flexible lease.
While operators like WeWork that largely run on a long-term lease business model could be in trouble, others such as Industrious that operate on profit-sharing agreements with landlords could gain traction.