COVID-19 and Workplace Resilience

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― White Paper

COVID-19 and Workplace Resilience Fred Schmidt, FIIDA, LEED AP, Managing Principal, Global Practice Leader


Where do we go from here?


― White Paper

COVID-19 and Workplace Resilience

Watching the COVID-19 global

While we can make predictions for

pandemic evolve in real-time raises

the future—and some have made

alarms and brings our collective

outright declarations—none of us know

uncertainty about the immediate

exactly what our workplaces will look

future into sharp relief. What will family

like in the coming months and years.

gatherings look like after this? Will

Some suggest radical changes, like

anything feel normal again? When will

eliminating or drastically downsizing

I get to go to a baseball game? We

offices, while others suggest enlarging

all want the answer, a specific path

and further enclosing workplaces.

forward to assuage our concerns and

In order to offer more than just

clarify our next steps.

conjecture, we look to data—such

But the fantasy of a single answer is exactly that: a fantasy. Designers and architects are grappling with questions about the built environment post-COVID-19: How will this affect our cities? What does it mean for our workplaces? As a partial response, many companies have developed Return to Work programs, which provide guidance on transitioning back

as satisfaction measures of workfrom-home programs—to help us imagine our future. But data alone cannot account for our personal behaviors; work continues to change in unpredictable ways in response to this crisis. The built environment will adapt, but these changes will not occur immediately. The important questions before us beg for more time.

to the office. Nevertheless, questions about the end state of the workplace remain. Considering the current or future pandemics, this paper examines what the longer-term future might be for the workplace, and for the attendant real estate decisions.

In unprecedented times, the fantasy of a single answer is just that: a fantasy.

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Continuing Shifts in the Way We Work We do know we are not returning to

accommodate more socially distanced

the offices we left. Certain changes

workplaces, but only to a point.

have already been enacted for our

Those who suggest meeting rooms

safe return to the workplace, such

will double in size have likely not had

as staggered working hours, social

a financial stake in a corporate real

distancing, touchless fixtures, higher

estate decision. Given the cost of office

cleaning standards, changes in food

space—particularly in major markets

and beverage offerings, and enhanced

where large companies are located—it

building systems. These modifications

is unlikely that clients will take on extra-

will continue as we learn and work

large leaseholds in response to the

together, but questions persist about

current crisis.

our longer-term occupancy needs. Will companies require less space, or more? Density will decrease as we

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― White Paper

COVID-19 and Workplace Resilience

Some companies have answered these

more productive working from home.

occupancy questions with a simple

It seems our instant, nationwide

solution: keeping their workforce at

work-from-home experiment has been

home. Facebook, Square, Shopify,

a success! However, in light of this

and Twitter are visible examples

success, we need to recognize that for

of companies who are allowing

some, working from home is simply

employees to continue working from

not sustainable. Many people do not

home indefinitely. A Gallup poll

have the physical space, connectivity,

showed 39% of employees had the

or familial/social arrangements

option to work remotely in mid-March.

necessary to support working from

Several weeks later, that number

home. Being forced out of your office

jumped to 57%. This trend is predicted

and into a work-from-home scenario

to continue, with Cushman & Wakefield

during a crisis is radically different than

reporting 73% of people feel their

volunteering for a well-curated work-

company should embrace some level

from-home program.

of working from home. Additionally, recent McKinsey & Company research found 40% of people felt they were

Those who suggest meeting rooms will double in size have likely not had a financial stake in a corporate real estate decision.

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The Value of the Workplace In a recent PwC survey, 54% of CFOs

Engaging employees in ongoing

responded that they planned to

training and development—much of

make remote work a permanent

which occurs during serendipitous

option for roles allowing it. In many

interactions—is difficult with a remote

sectors, employees have proven they

workforce. The most aware companies

can successfully work from home,

have long recognized the wisdom

leading some to suggest a centralized

of “must be present to win” as a

workplace is unnecessary. To them, we

workplace mantra. By establishing the

offer a staunch rebuttal. Collaboration

workplace as a “place,” companies

suffers when we work remotely —

serve their goals of brand- and

research published in New Technology,

culture-building. How else will new

Work and Employment journal found

recruits learn “how we do it here,”

team performance was negatively

if there is no “here”? The workplace

impacted when co-workers worked

can be a crucible for communication

from home. The workplace is also a

and collaboration, which in turn can

key part of recruiting and retaining

foster innovation, the holy grail of

talent. Recruitment and retention

corporate leaders.

was a primary design challenge preCOVID-19 and will return as a business focus when this crisis has passed.

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― White Paper

COVID-19 and Workplace Resilience

Across generations, there are dueling

However, we cannot ignore the tension

employee desires for both flexibility

between the collaborative benefits of

and in-person professional support.

a physical workplace and the isolating

Constantly working from home

public health precautions required

has adversely affected younger

during a pandemic. Some of these

generations, surprising those who

precautions may persist far longer

assumed “digital natives” would

than we would like. Indeed, as first

thrive in a remote work environment.

established in 2009 by epidemiologist

Cushman & Wakefield found 70% of

Dr. Larry Brilliant, we are amid the “Age

Generation Z and 69% of Millennials

of Pandemics.” This age is defined by

experienced challenges while working

successive waves of highly adaptable

from home, compared to 55% of Baby

infectious diseases, borne out of

Boomers. This younger cohort is missing

our extensive use of antibiotics and

out on valuable professional training

antiviral medications.

and mentorship opportunities Baby Boomers have already experienced in their careers. Over the long-term, these lost experiences may lead to retention issues.

We cannot ignore the tension between the collaborative benefits of a physical workplace and the isolating public health precautions required during a pandemic.

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(continued on next)


The Value of the Workplace (continued)

Predicting the long-term future of the

Though the virus will continue in

workplace depends on the long-term

some form, this period of crisis will

future of the pandemic. While we

end, as indicated by the pandemic

can design a workplace strategy to

phases outlined by the World Health

weather the storm, the final outcomes

Organization and the Centers for

depend on the severity and duration of

Disease Control and Prevention.

the storm itself. The Washington Post

Although it may seem interminable

reports “with so much else uncertain,

now, we will get to the other side of

the persistence of the novel virus is

this moment in history.

one of the few things we can count on about the future.�


― White Paper

COVID-19 and Workplace Resilience

The continuum of pandemic phasesa

a

The continuum is according to a “global average� of cases, over time, based on continued risk assessment and consistent with the broader emergency risk management continuum.

Although it may seem interminable now, we will get to the other side of this moment in history.

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Scenario Planning for Multiple Futures To try to envision the future of the workplace, we turn to scenario planning. We have created four potential scenarios for the workplace after the crisis has passed.

― Scenario 1

― Scenario 2

Play Ball!

Change-up.

In this Scenario, a breakthrough

In this Scenario, treatments are

vaccine or therapeutic treatment

developed for COVID-19, but it remains

relegates COVID-19 to history, like

an ongoing threat, like seasonal

polio. Although more of us will work

influenzas. Every year, we will be

from home, we will return to the office,

reminded to wash hands and cover-up

and to working and recreating in

coughs. We will also be armed with

essentially the same fashion as before.

the knowledge that employees can

Some minor changes in our workplace

successfully work from home. There

behaviors and designs will occur, but

will be further design changes to the

we will be back at our desks, and at

workplace, such as more touchless

baseball games, in full force.

controls, greater spacing, and higher levels of workstation enclosure. These enclosures will address the ongoing clamor over distractions in the open office and the abiding concerns about the transmission of pathogens.

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― White Paper

COVID-19 and Workplace Resilience

In this “Age of Pandemics,” we pine for Scenario 1 and fear Scenario 4, but the more probable future alternates between Scenario 2 and 3. We must plan for these multiple futures by creating flexible strategies and an adaptable workplace that can toggle between scenarios as needed.

― Scenario 3

― Scenario 4

Shutout.

Wild Pitch.

If no effective preventative or

If no medical measures are found

therapeutic treatments are developed,

and social distancing and isolation

we will remain in our current state. Our

measures prove too tiresome or

only weapons will be defensive: cycles

impractical, the virus will sweep the

of social distancing, self-isolation, and

globe in deadly waves, killing millions.

eventually some form of herd immunity.

This Scenario could see the collapse of

This Scenario will see aggressive

healthcare systems, governments, and

adoption of work-from-home programs

society as a whole. In this environment,

and more profound changes in office

most who can work from home will do

design, including UV filtration systems,

so, and workplace design will recede as

increased individual workplaces, and

a critical issue for companies.

reduced communal spaces. In this Scenario, the virus is expected to have more impact on long-term real estate decisions than short-term design modifications.

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Impact on Design Our current experience has prepared

Designing a wellness-centered

us to respond to future pandemics

workplace by incorporating natural

with work-from-home programs and

light and views, promoting indoor

social distancing. Within the workplace,

air quality, and honoring biophilia

we can make non-architectural

allows the office to serve as a place of

interventions like stowing difficult-to-

refuge. The World Economic Forum has

clean soft seating in favor of individual

stressed the importance of focusing

work carrels, while deploying screens

on the intersection of employee and

and whiteboards where temporary

company well-being. In the “Age of

separation is needed. The large social

Pandemics,” every business is in the

spaces enriching employees’ lives

health business.

in Scenario 2 can be repurposed to accommodate socially distanced workstations in Scenario 3. Once the crisis calms, the space is restored to a place where employees can connect.

By developing flexible work-from-home policies, enacting new spatial and furniture protocols, and imagining the workplace as a service center and a restorative place, we are designing for

After this pandemic passes, companies

multiple and unpredictable futures.

will have an opportunity to elevate

This is workplace resilience.

engagement with their employees by leveraging the office as a service center and a place of refuge. Many companies were pursuing this level of engagement long before COVID-19, and now it will be even more imperative. This service center model may include offering physical and mental healthcare services, financial planning, IT support, and convenience services curated to holistically support employees’ well-being.

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― White Paper

COVID-19 and Workplace Resilience

In the “Age of Pandemics,” every business is in the health business.

Impact on Real Estate Ultimately, these futures will affect

As previously suggested, touchless

real estate decisions. The surprising

fixtures and controls for entry, A/V,

success of our forced work-from-

food services, and copiers may become

home experiment suggests more

standard expectations in future office

companies developing employee

designs. More drastic design changes—

mobility programs. However, multiple

like high-performance HVAC systems,

national surveys prove while a majority

interconnecting stairs, increased

of employees want to partially work

private offices, and single occupancy

from home, anywhere from 60-90%

toilet rooms—will have a greater

of employees want to return to their

impact on negotiations for tenant

offices. This points to a continued

improvement allowances.

investment in office real estate, albeit with a slight reduction of footprint. (continued on next)

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Impact on Real Estate (continued)

Multiple national surveys prove while a majority of employees want to partially work from home, anywhere from 60-90% of employees want to return to their offices.

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― White Paper

COVID-19 and Workplace Resilience

Working from home has eliminated

Nevertheless, relocation to these

commuting and some employees

markets would avoid the highest

have experienced new levels of

concentration of pathogens and help

convenience—particularly those

to ease the affordability challenges

without caregiving responsibilities.

faced by Millennial and Generation Z

While many are excited to return to

work cohorts.

their offices, it is difficult to imagine anyone is eager to resume commuting. There are also newfound concerns about utilizing mass transit and many are skeptically viewing the density of urban spaces through a pandemic lens. These new concerns could encourage the development of suburban or exurban real estate solutions. Steve Pumper, Transwestern Executive Managing Partner, suggests suburban offices may become more attractive within the next 3-5 years, especially if they offer amenities like those in urban markets. The “Hub-and-Spoke” model, where a company has an office in a city center and operates suburban satellite or co-working facilities, may emerge as a compelling alternative. Relocating to secondary or tertiary markets would be a reversal of a decades-long urbanization trend.

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COVID-19 has raised the stakes for landlords. Tenants will expect higher quality spaces, amenities, services, and cleaning and security protocols. Additionally, this pandemic has layered uncertainty on top of a rapidly-changing business world, which will leave tenants seeking safety in the form of lease flexibility. As an occupancy strategy, tenants will seek shorter-term leases, or leases with multiple expansion, contraction, or exit options incorporated. However, such lease term flexibility comes at a price. Short lease terms also impact tenant improvement allowances. Occupiers will need to fund a greater portion of the construction themselves or bear a greater T.I. burden in their lease terms. The bottom-line impact of all these changes will result in higher lease rates.


The Future Workplace Clearly, no one has “the answer,”

aspect of our lives, and we will

because there is no single response

likely be challenged again by future

to the unprecedented challenges

pandemics. Companies must increase

presented by the pandemic. Still, we

their resilience by developing robust

can draw some conclusions about

work-from-home policies, maintaining

the impact on design and real estate

reliable IT infrastructure, and investing

decisions. We will see an increase

in safe, adaptable offices to support

in mobility programs, with more

employee wellness during all phases of

employees working from home at

a pandemic.

least part of the time. As a result, it is possible we will see some reduction in demand for office space in the CBD and a concurrent increase in demand for suburban office space. Spurred by future pandemic and economic concerns, market demand for lease term flexibility and increased T.I. allowances will raise lease rates. Our workplaces have evolved

We will not join those who predict the death of the office. The office will resume its position as a key component of recruitment and retention, with high-quality spaces, services, and amenities. When we work together in a physical—not digital—space, we will once again see the workplace deliver on its potential for fostering innovation, mentorship, and community.

continuously over the last century. The pandemic has impacted every

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COVID-19 and Workplace Resilience

About the Author Fred Schmidt entered college as a premed student, but soon felt a stronger connection to a different calling.

When we work together in a physical—not digital— space, we will once again see the workplace deliver on its potential for fostering innovation, mentorship, and community.

Visiting a college friend’s neighbor, Fred entered a house unlike any he had ever seen, filled with modern furniture and art. He was impressed with the home, so he started asking questions and learned the owners were architects. Shortly thereafter—having switched schools and transferred majors—he poured himself into the architecture program to hone his design and problem-solving skills. Later, he developed his analytical skills in a graduate program in EnvironmentBehavior Research. Fred has developed an unique design philosophy that revolves around program definition and careful problem resolution. This has been shaped by his early training in research and environmental design. Fred’s operating philosophy is that each project is a journey to be savored and enjoyed by the design team and the client.


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