For decades, large companies such as McDonald’s, Kraft Heinz and General Electric have made the strategic decision to base their headquarters in the more population-dense, eccentric areas of the city. It was in 2018 that McDonald’s made the switch from the suburbs to the lively Loop neighbourhood in Chicago.
This type of decision is made with a number of factors in mind, namely the proximity of the new offices to the crux of the city, and with that comes the array of millennial talent, the skilled workers born between 1981 and 1996. By making the switch from the suburbs, McDonald’s based its head offices right in the middle of Chicago meaning that it became a great place to work for these millennials due to how close it was to the nightlife, the food outlets, the hustle and bustle of the city that so many people crave.
With a sudden shift towards working-from-home, this type of strategy is surely expected to go out the window.
The pandemic has brought with it new guidelines for businesses to maintain social distancing measures meaning that the skyline offices that occupied space in major cities across the world will face massive difficulties, and will perhaps cease to exist in several years. With the use of elevators being advised against, and office owners being informed that their employees should be operating more than 6ft apart at all times, business meetings are quickly becoming a part of the past.
With millennials suddenly looking at more suburban areas to purchase their family homes, will we see offices shifting to accommodate the movement of their employees, to avoid losing valuable skilled staff?
James Ritman, executive vice president and managing director at commercial real estate service firm Newmark Knight Frank’s Connecticut office recently was quoted in saying “It’s not working from home that people want to do forever,”. It is not binary in that we are shifting from working in an office to working from home. A hybrid solution is what must be decided on by business owners, which offers flexibility to their staff.
Workers are simply coming to the realisation that ‘I can be a lot more productive if I can work closer to home.’
Giant companies such as Twitter and Facebook have been happy to allow their employees to adopt a work-from-home approach, with the former content with it as a permanent solution. What will this mean for office space in cities?
Investment in REIT’s is falling, meaning that the future of commercial office space is shrouded in uncertainty. People still need a place to work that is more appropriate than their kitchen table, but modern-day 20 storey offices won’t suffice. An open space with parking and flexibility to work remotely will be the future for a lot of businesses as they attempt to hold onto their talent.
What would your ideal future occupational environment look like?