― 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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