The Tide Is Turning Away From Shrinking Office Footprints
As businesses around the world grow more familiar with the pros and cons of remote work, their commitment to the office is deepening.
Multiple surveys conducted in the past month indicate that office-using companies do not intend to shrink their footprints. Only 17% of CEOs surveyed by KPMG reported any intent to cut back on office space, down from 69% in August, Reuters reports. A survey of accounting firms by the American Institute of CPAs found that 72% plan no change in their office usage against 20% that plan some sort of reduction, with 7% planning to grow their footprints.
Part of the increase in the share of companies not planning to shrink their footprints could stem from such companies having already executed givebacks. Net absorption fell to its lowest annual total on record in 2020, according to Colliers' national fourth-quarter office report.
Major financial institutions in the UK such as the 18,000-employee Nationwide Building Society are committing to flexible or hybrid working models on a permanent basis, Yahoo Finance reports. Citigroup will also require most of its employees to work in offices only three days a week and is banning internal Zoom meetings on Fridays, The Wall Street Journal reports — an acknowledgment that virtual interactions take a toll.
Neither of those announcements came with sweeping changes to office usage plans, though Nationwide announced its intent to close two suburban offices, Yahoo Finance reports. That decision underscores a sentiment expressed by Bisnow readers in a March survey that the hub-and-spoke model predicted by many to be a common reaction to remote work is not as popular as some initially imagined.
Other major employers reasserted their commitment to office work in recent days. Amazon Vice President of Global Real Estate and Facilities John Schoettler told Bisnow that the company does not plan to give back any of the 44M SF of offices it occupies and that it will follow through with its previously announced expansion plans in multiple cities.
Like Amazon, banking giant Morgan Stanley expects to bring its employees back to the office by the end of the year, Commercial Observer reports. Some permanent remote work will remain, but only for certain categories of employee, a spokesperson for the bank told CO.
