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No ‘one size fits all’ in hybrid workspaces
INTERVIEW No ‘one size fits all’ in hybrid workspaces
Corporate occupiers grapple to fit out their offices to maximise space and create a high-performing hybrid workplace as the remote and in-office work setup becomes permanent, Cushman & Wakefield said.
Employers continue to put employee experience at centre-stage in the way office space is utilised whilst also ensuring the well-being of workers and incorporating environmental, social, and governance (ESG) standards in the design.
Sharon Wee, Head of Client Services for Southeast Asia (excluding Singapore), Project & Development Services at Cushman & Wakefield, spoke with Real Estate Asia Editorin-Chief Tim Charlton on how employers can strike a balance in keeping workplaces flexible whilst maintaining corporate culture and equity of employee experience.
Your recent report discusses how hybrid is going to be the new permanent office set-up. Can you give us an example of how that looks?
This whole hybrid employee experience has been at the forefront of all organisations in the past five years because of the war for talent, especially in the Asia Pacific where the workforce is younger and tech-savvy. With the added complexity of the COVID-19 pandemic, we now have what is being described as a hybrid workplace. This modern workplace will have variations of a hybrid fit-out, either simple or complex, as employees and organisations come to terms with working from home and in the office. For example, offices with hybrid fit-out will appear to be more lifestyle-oriented.
How different will the hybrid office set-up be from the old hot-desking concept? Can you give us an idea of how this can look?
We are seeing major shifts from permanent workstations and assigned seats. A hybrid workplace consists of different types of settings for different types of work. It also describes the balance between working from home and in the office.
If employees want to do more focused and quiet work in the office, there will be a designated area that is perhaps similar to a library quiet zone. If a collaborative space is preferred, loose furniture or something more lifestyle looking is the norm now. Some of the technology firms have modular arrangements that encourage the free flow of ideas during brainstorming activities and discussions. For people who are just coming in for half a day or a couple of hours, they have their designated workstations or non-assigned workstations, which are most likely booked via a bespoke application. The technology-enabled workplace is now the norm and demanded as it optimises the employees’ workplace experience.
Does this mean that meeting rooms are a little bit less of a thing of the past when people are going to be sitting around the high tables in the kitchen, for example?
Yes, but it all depends on the culture of the company. We definitely see more of that in the US, Europe, and Australia, as compared to Asia and Southeast Asia. This is the culture we advocate to our employees and clients, as well. You might not need a six-pax meeting room for a casual conversation with a colleague, it could just be a coffee room chat. For culture building and branding purposes, organisations may prefer such activities to take place within their spaces instead of an external coffee shop.
Educating employees on the right etiquette in terms of using meeting and conference rooms for appropriate tasks and events becomes essential. Right-sizing and using the meeting rooms appropriately is one of the areas in workplace strategy that we address with our clients.
Sharon Wee, Head of Client Services, Cushman & Wakefield
Offices with hybrid fit-out will appear to be more lifestyle-oriented Now Cushman & Wakefield have a workplace strategy tool called Experience Per Square FootTM (XSF). Can you tell us how that works?
Employee experience has been top of mind for clients
The purpose of the office is all about employees’ experience, engagement, collaboration, culture, and well-being
in the past five years. What Cushman & Wakefield has developed is a data-driven tool, utilising sensors and surveys to measure and compare the experience of the workplace for individual users. This XSF tool statistically uncovers real estate and workplace metrics relating to employees’ engagement and experience.
But data is only data, what we layer on is the interpretation of this information to help clients realise what a high-performing work environment looks like. And during the COVID-19 pandemic, Cushman & Wakefield has adapted this tool to capture the work experience at home and in the office. A good example would be the work we have done for LinkedIn, which is renowned for the quality of their work environment. We compare and contrast over 30 LinkedIn offices across the globe with other clients and determine what a highperformance workplace looks like. Thereafter, we suggest the appropriate remedial action, which might be an upgrade or reconfiguration. The application of thoughtful design and fit-out standards is crucial in order to reflect the role and purpose of the office which is all about employees’ experience, engagement, collaboration, culture, and well-being.
What are some examples of a high-performance workplace that the tool can help uncover? What can companies do as quick fixes perhaps?
An amenity-driven setting as opposed to just a work desk with basic amenities results in a high-performing workplace, which improves productivity. In the long run, this will have a positive impact on the health and well-being of employees. An example of a quick fix would be keeping the workplace agile, by having more modular workstations and work settings that can be ramped up and down as required for different activities. Flexibility is the key here.
Employers need to be visibly addressing sustainability and wellness by integrating all relevant ESG measures into the workplace One thing that your report has highlighted was companies are looking for some ESG wins. What are some of the key ESG factors companies are looking for in their office?
Sustainability is not a new topic for either investors or occupiers in corporate real estate, but the approach to sustainability goes beyond seeking green and wellness certifications such as Leadership in Energy and Environmental Design (LEED) or Green Mark accreditation. Clients are setting their own standards and agenda, as we are at Cushman & Wakefield, around sustainability and roadmaps to carbon neutrality. This ties in to what was mentioned earlier about employee experience, where wellness is also top of mind. The talents today are also increasingly more environmentally, culturally and socially conscious. In order to retain and attract all these new talents, employers need to be visibly addressing sustainability and wellness by integrating all the relevant ESG measures into the workplace via design and aligning with their corporate values.
You’ve also just put out the much-anticipated 2022 Asia Pacific Office Fit-out Cost Guide. How are your clients using that? And what can we learn from that?
Cushman & Wakefield’s annual Office Fit-out Cost Guide is used by both our international and APAC-based occupiers for their capital expenditure planning. For multilocated organisations, it could be used for annual planning or just a one-off project for budgeting purposes. In this year’s publication, we have also included three key fit-out trends that will be useful for our clients, one of which is planning for permanent hybrid. We have been helping clients determine what this hybrid model means to them as different companies deal with the return-to-office in varying stages. It might seem daunting to them, but in this fit-out cost guide, we have also broken it down to three fit-out classifications—basic hybrid, collaborative hybrid, and advanced hybrid. Clients will want to know want to know how they can engineer an ideal hybrid ecosystem: how much space they need, what this space should look like, how much it will cost to fit it out, and how to meet the ever-growing design demands of the flexible workforce. All of these factors are being captured in the report.
Balance is key in keeping workspaces flexible
INTERVIEW How businesses in Japan mitigated financial woes
Japanese firms sold their realties or converted their real estate into business assets.
In the past 12 to 18 months, real estate industry leaders had been busy catering to firms that had a lot of properties in their books, which they could outsource or sell to secure their financial standing, Stuart Porter, Private Equity, Financial Services & Real Assets Tax Partner and Asia Real Estate Tax Leader, at PwC Tax Japan told Real Estate Asia.
“There was more of a market demand from Japanese corporates who [want] to enter in discussions about what to do with their real estate, which may include selling it or using parts of it in their business, or parts of it with other affiliates that they hadn’t thought of before,” he said.
This move allowed owners to focus on more important business matters, Porter claimed, adding, in the last three to four years, there has also been a big uptake in private equity transactions in Japan, where the underlying real assets held by the acquired company are then sold and the proceeds used to refinance the acquired business.
What happens to the sold property?
Investors, both local and foreign, “remain very hungry” for affordable real estate assets (being assets that generate good stable yields with low funding costs), Porter said. This is especially so now that Japan’s Ministry of Foreign Affairs is opening up to foreigners for employment and business purposes since 1 March, so investors are now gradually able to visit Japan and assess their existing investment and/ or source for new ones.
The majority of the global investors eyeing to own lands in Japan include Europeans, large foreign pension funds, and to an extent, governments with sovereign wealth funds in Asia—they usually partner with asset managers in a single asset or single-managed funds, typically through Singapore or Luxembourg (where there may already be people on the ground).
Porter said the weighting of Japanese assets is considered “pretty heavy” because they are more expensive and generate stable yields, compared to most Asian assets.
Due to this, there are some foreign asset managers who do not have a presence in Japan, investing in the country, not to buy assets, but to buy asset management firms along with their employees because of their experience.
“[They are] using that to raise funds to support investments and investors in a market that usually has a reasonably good weighting for any Asian fund. That’s for the inbound business,” he said.
Other trends
Another trend PwC expects in Japan is the change from decentralisation in both the commercial and residential real estate markets because of the work from home environment. Porter also noticed that Japanese corporates have become more flexible in their work arrangements. In particular, the government has also become more flexible in terms of accepting data or submissions electronically, in light of the remote working environment.
Several service providers and other foreign-owned groups, meanwhile, continue to work from home because of the pandemic, he said.
Since business travellers and business investors are starting to come back to Japan to look at their assets and look at the opportunities, Porter said: “That would necessitate all of us going out to meet them and have meetings that we were used to all the time. So I think then we’re going to move more to hybrid working.”
Porter also said that complying with green mandates is also gaining traction, especially amongst real estate developers. There also remains continued interest in warehousing and data centres investments in Japan.
“It’s actually been quite a busy time for the real estate industry in Japan. Initially, obviously, they were affected by everything in the earliest early months of COVID. But since then, it’s actually been a very buoyant market even though a lot of it’s been done from home like everywhere else,” he said.
Stuart Porter, Private Equity, Financial Services & Real Assets Tax Partner and Asia Real Estate Tax Leader, PwC Tax Japan
Investors “remain very hungry” for affordable real estate assets
ANALYSIS: ARCHITECTURE Architecture transitions to an ‘integrated’ industry
Firms said professionals must be experts not only in design.
If there is anything that changed in the past year in the field of architecture, it is that the industry has become integrated— from how architects are designing structures down to the way firms are transforming themselves.
Matthew Hon, Managing Director for Swan & Maclaren Singapore, said clients nowadays have different intentions with their properties, with some wanting to seek enhancement to their land for higher valuations.
“The scope of architecture has changed from a full service of design to completion of the development, to provide a certain level of a design package or even up to a certain stage of obtaining approvals,” Hon said.
In 2023, Hon sees that clients will like the firm to propose solutions on a full suite of integrated consultancy services. Because of this, Swan & Maclaren Singapore had to change the setup of its team in the architecture practice to become tomorrow’s built environment service and product solution.
“An office may no longer be solely full of architects of design and project architects but consist of individuals that carry a diverse background and skill set to package the proposal needed,” he added.
“Architects who only perform design may find themselves being challenged in its existence, with globalisation and the new interconnected world,” he added.
Intertwined structures
Integration will also be key to designing buildings in 2023, according to Doreen Koh, Vice President of Architecture, Healthcare Division, at CPG Consultants.
According to Koh, buildings will no longer be seen as “standalone structures but as part of the overall built environment intertwined with other infrastructure, transport, and community concerns.”
Domestically, a concern that the industry is focusing on is sustainability. According to Ivy
“We now have better clarity of the benefits and projected returns of investment from the adoption of a vision of net-zero carbon and sustainable smart buildings. Selection of sustainable materials and energysaving from Internet-of-Things (IoT) are also some of many ways to achieve this vision,” she added.
Apart from focusing on sustainability, architects are also going beyond aesthetics and designing buildings that ultimately benefit the community like open spaces with small pocket parks, and urban farms which encourage social connections.
Surbana Jurong has developed a high-density vertical farming concept, called Floating Ponds which allows farms to be commercially productive even on limited land areas. “It is important for architects to adopt an immersive design process in understanding the needs of the community, and involving the community in the design and creation process where possible to create a sense of ownership,” said SJ’s Koh.
Currently, Koh said architects are already designing spaces that can accommodate multiple uses. Urban spaces for example, are being designed to be more controllable, manageable, modular where possible.
Junlin Ong
Doreen Koh
Jean Cheong
Architects who only perform design may find themselves being challenged in its existence with globalisation
Koh, Director of SJ Architecture in Surbana Jurong, almost 40% of global carbon emissions today are from buildings and construction.
“The building and construction industry is expected to make an even more concerted push toward sustainable developments to meet the Singapore Green Plan 2030 and long-term net-zero aspirations, with further adoption of new technologies and approaches to building design for more energy-efficient buildings,” said Yong Fen Bok, Vice President for Architecture, Education Division, at CPG Consultants.
Junlin Ong, Senior Associate at RSP, said that there is a “driving need for the industry standards and approach on sustainability to improve, and to bring about greener results for the well-being of its occupants and the environment.”
The SIT University Punggol Campus, for example, was designed with the largest private Micro Grid (MEMG-Multi Energy Micro Grid) and a District Cooling System that powers and cools various spaces.
“When in operation, quality indoor experience and thermal comfort will be achieved whilst running on clean and sustainable sources,” Ong said.
In 2023, Jean Cheong, Senior Associate at SAA Architects, said sustainability and regenerative architecture will remain on top of trends in the field.
Staying relevant
Another way for firms to stay relevant in the field is by embracing and adopting digital technology.
According to RSP Singapore Senior Associate, Khoo Teik Rong there have been several emerging applications in the industry such as image generating software, DALLE.E and Midjourney.
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Surbana Jurong developed a high-intensity vertical farming concept called Floating Ponds (Photo: Artist’s impression)
