One of the biggest challenges that COVID-19 has put in front of us is the lack of a clear roadmap to follow. In fact, navigating the pandemic is a bit like walking through a hall of mirrors, where nothing is quite what it seems. However, despite this uncertainty, there are those who have claimed that this crisis signals the end for offices.
Their argument probably sounds quite familiar: now that people have got used to working remotely, offices will become increasingly redundant. The logic is quite compelling, and those defending this theory are quick to quote the words of Warren Buffet’s at his latest shareholder meeting – albeit a rather loose interpretation of what was said.
However, this isn’t the first time that people have scare mongered about an imminent “apocalypse” in the Real Estate sector. The retail sector was set to suffer the same fate a few years ago, when pictures of abandoned shopping centres in the US led some experts to warn that the end was near in the wake of the e-commerce boom. Retail and offices have therefore each been doomed to fall victim to a disruptive trend: e-commerce and remote working respectively.
This logic is flawed, however, because it overlooks the all-important factor of customer experience. In both retail and offices, it’s the end-user that defines which experience they value the most – they have the power to choose and are unlikely to favour just one option when they can dip in and out of both worlds depending on whatever suits them best.
Rather than a disruptive force, COVID-19 is be better described as a catalyst, accelerating changes that were already a step ahead of the outbreak and which are moving the Real Estate sector towards a more people-centric model. For years now, CBRE has been championing a radical transformation of office space – the so-called ‘New Ways of Working’ – a concept which we now believe must be taken to the next level to create the omnichannel office of the future.
In fact, retail can help us to understand how offices need to change. Omnichannel retailing has given consumers the freedom to move freely between the physical and digital channels, using whichever options suit them best at any given time. Even when they are inside a store, some consumers now make purchases on their phone.
Teachers give online classes to their students using videoconference apps.
The omnichannel approach will be fundamental to changing how offices work. As such, we can expect to see workers moving freely between physical and digital spaces, in what is referred to as the phygital phenomenon, or the interaction between these two worlds. Workers will be able to choose if and when they go to the office, work from home or work remotely from a different work environment, such as a co-working centre.
The joy of shopping, the leisure and social aspect, the opportunity to try out a product in a showroom – these can all be extrapolated to the experiences shared between team members, the creation and innovation that stems from collaborative working, and the pride of belonging to an organisation. Offices will need to evolve and become places that promote community, creativity, and the simple pleasure of spending time with colleagues – in short, they must become as flexible as the occupiers themselves.
As with retail, the omnichannel challenge will start to create a greater divide between prime offices and offices that fall short of occupier requirements.
Also, mirroring the flagship store trend – where the aim is not only to sell but also to strengthen customer loyalty – an omnichannel approach could increase the overall need for space among corporations.
So, the doomsayers are wrong. This is not the end of the road for offices, we are simply hitting the accelerator button on their transformation, as Warren Buffet himself said. Offices are unlikely to go back to what they were before, but instead will evolve to become more flexible, all-inclusive, people-centric spaces.