Ari Rastegar is CEO of Rastegar Property Company, a vertically integrated real estate company with a focus on value-oriented real estate.
Since nearly the beginning of the pandemic, people and publications have been declaring the death of the office. But with many experiencing intense isolation and struggling to maintain productivity working from home, employees will be excited about even a partial return to the office. However, many young employees took advantage of the prolonged work-from-home situation and moved out of high rent areas like New York and California in favor of smaller, more affordable metros across the country. Because this opportunity enables them to save money without being tied to a physical office, a large number of workers in the U.S. may not be overly eager to give up that freedom but still miss the connected feeling of in-person workspaces.
This is where the hybrid work model comes into play, something several big-name companies are already piloting, and why we’re far away from the end of the office. Employers want to allow employees who like remote work to continue doing it while also providing employees who prefer in-person work the ability to come into a physical office. For example, Google has announced that when its employees return to the office, they will be able to work together in person for three days a week and then have the option to work remotely outside of those three days.
Deciding whether to embrace a hybrid model or return to full-time, in-person will vary across industries. Heavily regulated fields, like finance, have struggled to work from home during the pandemic and would welcome a return, while most 9-to-5, service-oriented office workers have thrived out of the office. Employers who have struggled during the pandemic may be exploring options outside of high-price traditional office buildings. One option that is being explored is breaking up the large office into smaller satellite offices, spread across various cities, allowing further flexibility for employees to choose in-person or remote work. After all, humans are social creatures, and many people not only want but need the social interaction provided by the office to feel fulfilled in their role. This need to socialize is another key reason why it’s unlikely that there will be a complete shift to full-time remote work.
A return to the office is welcome news for employers, employees, as well as real estate investors in office space. Despite the gloom of the pandemic and high vacancy rates, many investors still saw value in the office and considered its return inevitable. For developers and building owners, it might be necessary to make changes to existing floorplans and new projects to allow for the changing needs of their target clientele. For example, a hybrid office may mean more people are “hot-desking” and that there will be a greater emphasis on spaces for group work and meetings, rather than the traditional rows of desks and cubicles. These changes to buildings can be made with large-scale renovations, or be as simple as rearranging furniture and conference room layouts. Investors in office space will want to pay attention to how these plans are being implemented when evaluating potential investments.
A hybrid office will require adaptations to make existing layouts accessible in the long-term and safe in the immediate, but not every office building or company will be ready to make all necessary changes. The next iteration of the office will likely see a less open-concept floor plan, with more space between desks. These adapted offices will also become increasingly customized to the needs of the organization occupying the space, making it more productive for those specific workers. With employees missing the office and the rich culture of in-person work, the office will return — it may just look a little different when we get there.
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Ari Rastegar is CEO of Rastegar Property Company, a vertically integrated real estate company with a focus on value-oriented real estate. Read Ari Rastegar’s full