The future of office space

On Wednesday 17 Feb 2021, Hall & Wilcox was proud to sponsor the VPELA Webinar - ‘The Future of Office Space’. Over 75 attendees zoomed in and we heard from Simon Pole – Global Director, Design, Unispace; Soren Trampedach – Founder, Work Club Global and Faculty: Singularity University; and Nicole Ward – Regional Portfolio Manager (Office): Charter Hall.

The panel provided a thought provoking discussion, and it was valuable to hear concurrently from designers of office space and landlords of office space.

Before reflecting on the key takeaways from the panellist’s conversation, it’s sage to remind ourselves how COVID-19 has accelerated the digital revolution timeline for most businesses, forcing organisations to maintain seamless business operations while maintaining social distancing in the office, or having employees work from home.

For many, COVID-19 has been the catalyst that has grabbed organisations by the ‘scruffs of their necks’ and pulled them though an operational technological revolution. This rapid need to innovate has made COVID-19 the undisputed ‘Chief Technology Officer of the Year’ for the past two years.

Regardless of where one has been working, the last 12 months have introduced stresses that may have made it more difficult for people to perform at their best. Instead of thriving in work environments optimised for job performance, many people are now juggling work, family commitments and home schooling from the one domestic space. Is this sustainable over the long term?

What is the purpose of large centralised office locations?

Use of large, centralised office locations facilitate in-person collaboration, foster teams and are the nurseries of organisational culture. They will always have these benefits. In-person collaboration will continue to be the key to long-term business success, culture building and team shaping.

These environments are critical for growth and talent development, particularly the development of graduates, on-boarding of new employees and training junior staff more generally.

Face-to-face office functions support knowledge transfer (deliberately or by osmosis), the retention/protection of institutional knowledge, and the relational social interactions that are the glue of any corporate culture.

In the webinar, we heard that it has been the younger demographic who have mainly been hampered by the closure of central offices and remote working. Generally speaking, this was due to:

• Younger workers on average living in smaller homes, with less space to import setups which would enable efficient means of working from home;

• Younger workers generally sharing their homes with housemates who also needed space for their remote set ups and quiet for calls and video meetings;

• Lost opportunities for impromptu mentoring and learning by others’ example;

• Lack of diverse social interaction (i.e. water cooler conversation); and perhaps

• Missed openings for learning, project on-boarding and knowledge transfer by not being able to place themselves ‘in the right place at the right time.’

The social element workers have been missing was stressed by the panellists. Pulse surveys undertaken by Unispace indicated a decline in the desire for office workers to work from home the longer we spent in lockdown. 83% of those surveyed in May 2020 wished to work from home three or more days per week. This was down to 55% by the end of July 2020, and then plateaued at around 41% of those surveyed between September and December 2020.

We were informed that predictive analytics suggested between 24% - 37% of the legal work force will wish to continue working remotely three or more days per week following the rollout of a COVID-19 vaccine (Q1 2022).

Has COVID-19 reset the thinking behind the centralised office?

There is an old adage –“never waste a crisis”.

Instead of maintaining the traditional view that the office is only the physical place where workers work, the panel challenged the attendees to think about whether now is the time to re-shuffle our thinking to better support employee performance and organisational resilience while contributing more to our local communities.

Whilst not a ‘reset’, perhaps COVID-19 is the opportunity to question long-held assumptions about how work should be done and the role of the office, more broadly. The panel raised the point that businesses should be moving to promote the office as an anchor for collaboration and promotion of business culture - almost like a mission control for the organisation.

There is ‘no one-size-fits-all’ solution. The answer, different for every organization, will be based on what talent is needed, which roles are most important, how much collaboration is necessary for excellence, and where offices are located today (among other factors).

Will the office ever disappear?

You can’t change a culture over Zoom.

Physical spaces where people come together is where culture is built. Physical interaction is so critical to building a culture and fostering a team.

The office is not going to disappear, but it will require a fresh, new approach. People will still need places where they can come together, connect, build relationships, and develop their careers. Junior staff, graduates, clerks and interns flourish with close supervision. There are some things that just can’t be communicated effectively and efficiently at distance.

Simon Pole (Unispace) presented a graphic comparing the city office vs home office both pre-COVID-19 and post-COVID-19 in terms of how people would consider each space best for ‘focus’, ‘collaboration’, ‘learning’ and ‘socialisation’. The office retained its supremacy for socialisation and collaboration. Somewhat surprisingly, the ‘focus’ metric swung dramatically:

City OfficeHome Office

A move to a different model?

One of the takeaways that all panellists agreed upon was that the CBD office market will survive the aftershock of COVID-19, but it may be the suburbs that prosper through an ‘urban shift’. This would look like a more evenly distributed model of office and workspace throughout cities and geographic regions, rather than an agglomerated CBD.

Soren Trampedach (Work Club Global) explored this idea in greater detail with the attendees. He identified that there is such an opportunity within ‘on the fringe’ locations in major cities. These opportunities materialise through the proximity of different kinds of people, industries and disciplines. The establishment of urban fringe workplaces, and co-locating diverse industries and workplaces together, has the potential to create an ecosystem of innovation.

However, Soren qualified this with reference to Melbourne, by saying this model is inherently limited by the lack of transport links in Melbourne as you move out of the inner ring of suburbs. For this urban shift to take place, there needs to be a focus on upgrading and diversifying transport planning to enable the smooth transition from city to urban to suburban.

This information highlighted the shift in thinking. It appears likely that home working will complement office work, not replace it. Perhaps the office layout as we are currently familiar with, that being a desk based layout designed to ‘sweat the asset’, will disappear, and there will be a perceptible shift towards an experience-centric layout that fosters collaboration through design and incidental learning opportunities through the clever use of space.

Well-designed meeting spaces can contribute to a culture of learning and knowledge sharing, while amenities, access to natural light, and other aesthetic features can promote feelings of vitality.

Personally, I miss the collaboration and social aspects of a full office. Being in a busy office firmly flips the switch in my mind that these four walls are for working, learning and contributing to something bigger than the individual. There have been times during the various Victorian lockdowns where the lack of separation between work and home life has led to me feeling like I have been ‘living-at-work’ rather than ‘working-from-home’.

An alternative model would revolve around larger businesses and/or government departments, transitioning to a ‘hub-andspoke’ model. This is where the organisation would retain its central CBD headquarters (perhaps with a reduced footprint) as the ‘hub’ and then compliment this with a network of suburban satellite offices (spokes) within fringe urban workspaces. The satellite suburban offices would not need to be large or accommodate many staff at once. They would just need to be of sufficient scale to function and establish a presence, plus allow opportunities for innovation.

Thank you to all the panellists that contributed their time and thinking to the industry, and to the attendees who made it so successful. For those that missed it, the webinar is available to watch. Contact the VPELA office to purchase.

Matt Hughes is a lawyer specialising in planning & environment law at Hall & Wilcox with experience in both local government and private consultancy. and regularly acts, advises and appears on behalf of private developers and both local and state government bodies before VCAT, Planning Panels Victoria and the Supreme Court of Victoria.

Email: Matthew.Hughes@hallandwilcox.com.au