Commercial Real Estate - What is the New Normal?
This blog was written by Robert Leigh
2020 and the ongoing pandemic has blurred the line between our personal and professional lives and brought about a series of changes that would have been unimaginable a year ago. As a result, we all have had to adapt to new routines. Companies up and down the country would have been expecting, if not hoping, at the beginning of the year to have already returned by now to the prospect of a more ‘normal’ holiday season, celebrating their achievements this year with colleagues at their annual Christmas parties and lunches. However, due to COVID-19, we are all celebrating differently this year. At DeVono Cresa, we normally convene for our annual ‘Huddle’, where the entire team typically meets for an end of the year review, which of course has now been moved online. Although it will be nice for the team to connect in some way, albeit virtual, nothing can match meeting in-person. The entire country, if not world, hankers for a return to some semblance of normality, now a real prospect thanks to the deploy of multiple vaccines already in the offing. And yet, for many, we have already become accustomed to the many changes in our working lives and accepted our new reality. Some things may return to normal in 2021, including a return to the office – some things, however, will never be the same again.
The future role of the office
Apart from our impacted ‘daily lives’, a lot more has changed this year. Numerous sectors, including the commercial real estate (CRE) sector, have undergone consequential change. 2020 has forced organisations, regardless of industry, to adapt to evolving circumstances swiftly. When COVID-19 struck earlier this year, our key focus was to help clients understand their options concerning both contractual terms and short-term rent mitigations. In addition to this, our teams have consistently throughout the year carried out risk assessments, shared guidance on COVID compliance measures, helped clients with return to work strategy reviews, and redesigned office space so that the physical layout matched the changed work purpose.
As a result of COVID-19, many organisations have re-evaluated working practices and the role the office needs to play in 2021. Indeed, in the earlier parts of the pandemic, many questioned if COVID-19 would bring about the “death of the office.” However, following months on end of working from home remotely, corporate occupiers are now once again looking to the future and implementing office returns, appreciating elements of office-working with a renewed understanding that they did not previously value. Many clients have mentioned that they have struggled to foster a positive ‘work culture’ working from home. Clients have also told us that training new staff members has been more complicated than previously due to not being in the office.
In recent months, businesses have predominantly focused on location reviews and optimising workplace footprints as part of their return-to-work strategy. At DeVono Cresa, we have carried out stay versus leave assessments for clients. To help business leaders better make decisions about their short, medium, and long term real estate strategy, our team at DeVono Cresa unveiled our Commercial Real Estate Roadmap in November to help companies ‘Return, Revitalise and Transform.’
If you need help finding flexible office space that suits your business needs, or if you would like to find out more about flexible leasing, contact our flex team via firstname.lastname@example.org.
Client engagement and flexible leasing
In these evolving circumstances, we have tried to support our partners and clients, wherever and whenever possible, by helping assess changed needs and crafting bespoke workplace strategies that suit their needs.
Since March of this year, we have been actively engaging with hundreds of our clients consistently. Throughout the year, we have noticed an increase in demand for flexible office space. Our flexible team has made a case for why flexible leasing is suited to a post-COVID world, and we expect to continue to witness increased demand for serviced office space as we move into 2021, and beyond.
A better understanding of working from home
Everyone has experienced a workplace transformation this year. Most organisations no longer have a dependency on physical infrastructure. As a result, they are now more aware of the cultural issues presented with the lack of human connection and communication from in-person interactions. In isolation, it seems that many C-suite leaders now appreciate that working from home is not a zero-sum game. It requires a different level of risk assessment and exposure to costs. Since working from home began, there has, throughout 2020, been a disconnect around training, mentorship, and the creative side of teamwork.
Work From Home (WFH) to Work From Anywhere (WFA) – continued evolution in 2021
As we move towards the end of 2020, we have noticed one specific change in the CRE sector. Clients, both large and small, are now increasingly considering providing employees with a ‘hub’ office for all-hands meetings, project work, and for teams to get together on a rotational basis and check-in with each other, in addition to on-demand space to complement working from home. Using a mix of coffee shops and flexible coworking lounges offers productive, open, and COVID-19-compliant environments that are shared with like-minded co-workers – and of course, reliable Wi-Fi! The option of private hub offices and coworking lounge memberships across multiple locations is becoming increasingly attractive to employees and employers, irrespective of their geographical location. This CRE strategy is often referred to as the ‘Hub and Spoke’ model and is one that we expect to become increasingly popular in 2021 and beyond. There is already substantial evidence of the advantages of adopting such a flexible leasing approach from clients utilising our CRE roadmap as a part of their wider business strategy.
The flex sector is fundamentally nimble, adaptable and resilient, and so, is in the best position to provide what clients want and need in 2021.
We are incredibly proud of our teams and the support that we have given this year. We will continue to provide a high standard of advisory service based on both facts and informed opinion. We, like our clients, believe that trust is the basis of all good long-term relationships. The team at DeVono Cresa is here to help you and advise you on all elements of your commercial property journey. To understand how DeVono Cresa can help you, get in touch with DeVono Cresa’s Joint CEO, Robert Leigh at 020 7451 1339 or email@example.com.