Back to the Office: Are Businesses Returning in Droves?

Despite the ‘death of the office’ rumours that circulated in 2020, it looks like businesses are raring to get back to the workplace. Tech giants are snapping up offices in major cities, London office occupancy is nearly at 50% and Zoom’s very own CEO has Zoom fatigue.

While many of us spent most of 2020 working remotely under lockdown restrictions, several tech giants were busy expanding their office footprints. Facebook, TikTok, Netflix, Apple and Microsoft all signed up for office space in major markets.

Facebook, for example, which is “betting on an in-person future”, has spent recent months organising its urban campus in New York. Comprising two sites – just a 13-minute walk away from one another, Hudson Yard will be a creative, collaborative hub with plenty of event space, while Farley Post is set to be a dedicated tech hub for the firm’s engineers.

Under the premise that businesses gravitate towards the talent they want to hire, Facebook is sending a strong message to New Yorkers.

Earlier in the year, research showed that remote working was starting to elevate anxiety and paranoia because staff weren’t being reminded by spontaneous chats and hallway smiles that they’re in good standing with their peers.

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Likewise, Google is committing US$7 billion to expand and build out its office and data centre space across 19 US states. And Amazon has announced its plans for an “office-centric culture”.

Closer to home here in London, the story continues. Our Tenant Representation team – which specialises in finding businesses office space – had an immensely busy year despite the pandemic. In 2020, it concluded transactions on over a million (1,058,290) sq ft of office space for 49 businesses in the capital. For context, that’s up from 752,739 sq ft in 2019.

Notable transactions include advising law firm Stephenson Harwood on a 158,000 sq ft office re-gear and expansion, insurance company Nippon Life on a 7,000 sq ft relocation, and wealth management firm JM Finn on a 29,000 sq ft off-market relocation.

On top of that, our Flexible Office Solutions team – which specialises in finding flexible offices for businesses of all sizes – had a record month in April 2021 by finalising office space deals for 10 businesses and carrying out a total of 68 office tours around London.

And in the past year, the team has secured new office space for several fast-growth businesses such as sports nutrition leader bulk, creative design consultancy Sutton Young, and marketing advisory and accelerator Growth Shop.

But not only are businesses lining up their new offices – data shows that Britons have already begun to return. Morgan Stanley’s AlphaWise survey found that workers spent more than 40% of their time at their usual place of employment in April 2021 compared to just a third back in February 2021, indicating that we’re starting to spend more time in our offices.

Meanwhile, data from office sensors company Metrikus illustrates that office occupancy in London is up to nearly 50% (49.15%) – the highest rate since the pandemic took hold in March 2020.

Data from office sensors company Metrikus illustrates that office occupancy in London is up to nearly 50% (49.15%) – the highest rate since the pandemic took hold in March 2020.

Unsurprisingly, an enforced year of remote working has revved up the momentum to get face-to-face, collaborate and learn from one another again.

In our recent LinkedIn poll, we asked: “What are you most looking forward to about returning to the office?”. 62% of our 811 respondents said in-person collaboration, 31% said work-life separation and 5% said screens and ergonomic furniture.

For employees, the ambition to return is also fuelled by feelings of isolation. Earlier in the year, research showed that remote working was starting to elevate anxiety and paranoia because staff weren’t being reminded by spontaneous chats and hallway smiles that they’re in good standing with their peers.

LinkedIn News Editor, Kelli Nguyen, explained: “Employees are increasingly stressing out about how they come off over Zoom, or wondering whether unanswered Slack messages mean they’re going to get fired, exacerbating stress among those working from home.”

Business leaders share a similar eagerness to return. David Solomon, Chief Executive of Goldman Sachs has famously dubbed remote working an “aberration”, while even Zoom’s CEO, Eric Yuan, confessed at a virtual WSJ summit that he has Zoom fatigue – so much so that he now avoids booking back-to-back Zoom calls.

Data from (Y)OUR SPACE suggests that three flexible working models will trend: hybrid working, hub-and-spoke and work from anywhere – all of which, however, rely heavily on the office.

Likewise, Barclays boss Jess Staley recently announced that working from home wasn’t sustainable, and Jamie Dimon, JPMorgan's CEO is done with Zoom meetings and believes remote working doesn’t work “for those who want to hustle."

But this drive to return isn’t a drive to return to the office as we know it. Office requirements are changing. 55% of almost 400 global business leaders we interviewed as part of our (Y)OUR SPACE report want their offices to include more collaboration space. On top of that, we’re witnessing a flight to quality and a desire for amenity-rich space that supports wellbeing, collaboration, and training and development.

As businesses plan their workplace strategies for the post-Covid world of work, many are still figuring out how much flexibility will suit their teams. Data from (Y)OUR SPACE suggests that three flexible working models will trend: hybrid working, hub-and-spoke and work from anywhere – all of which, however, rely heavily on the office.

What’s clear is that almost all businesses (90% of those we interviewed for (Y)OUR SPACE) view real estate as a strategic device in attracting talent, facilitating collaboration, prioritising wellbeing and powering innovation.