Configuring Office Buildings for Investors - CXRE Commercial Real Estate

How Commercial Office Building Investors Should Configure Office Buildings for the 21st-Century

In the 1950s, many people dreamed that in the new millennium, we would live like the Jetsons with flying cars and robot maids. Because of technology, configuring office buildings would look very different. For example, workers would spend less time working, and more time enjoying leisurely pursuits. However, technology has not quite reached that point. Commercial real estate brokers who show office buildings for investors need to understand a few things.

And yet, while we have not arrived at the Jetsons’ level of working and living, the 21st century has still brought many innovations which have improved our office spaces. Some of the ways that technology and innovation are changing office spaces in the 21st century in cities like Houston are outlined below.

Open and Private Offices Are Easier to Lease

Open, free-flowing office layouts are becoming fairly standard these days. Despite some people’s view that openness decreases productivity, the trend towards open offices continues. Moving forward, the challenge is to design spaces which encourage collaboration. At the same time, these spaces must establish private spaces for meetings and quiet spaces for concentration.

But, Are Open Offices Really Good for Productivity?

Since tech giant Google led the way into the open office arena, modern executives, managers and business owners now tout this office concept. These proponents proclaim that open work areas inspire collaboration and create a team environment. However, many office workers say the opposite.

A Disconnect Between the Tenants and Their Employees

When 1200 office workers (600 executives and 600 employees) were surveyed about open offices by Oxford Economics, the results of the 2015 global study were surprising. According to the study, most executives fail to realize how much their workers value peace of mind. The study revealed that for most employees, open offices negatively affect people and overall productivity. However, most companies do not have the strategies or technologies to deal with the associated problems.

According to employees who responded to the survey, noise distracts most workers. On top of that, many have a hard time coping with it. Overall, 53 percent said ambient noise negatively affects their productivity and satisfaction. Yet only 41 percent could filter out the distractions. At the same time, when employees complained about noise and distractions, managers viewed these as low priority complaints.

In contrast, the survey shows that noise affects only 35 percent of executives and managers. In addition, 63 percent of them believe that their employees have all the necessary tools to cope with distractions. Generally, there is a good reason for the disconnect. On the whole, 62 percent of these managers and executives have private offices. As a result, they can’t relate to their employees’ struggles.

In many cases, employers and managers seem to benefit the most from open office layouts. In contrast, employees benefit the least. Primarily, the main advantage of open offices for employers is cost. Specifically, open offices are as much as 50 percent cheaper per employee than traditional office layouts. However, while open offices may seem to keep costs down, employers pay less tangible costs. These other costs take the form of worker frustration and dissatisfaction.

The Reality of Open Offices

In today’s modern work environment, open offices have become the norm. Consequently, there are more distractions. In the end, these decrease employee productivity and lower job satisfaction. Although workers want greater collaboration (which can be facilitated by open offices), the cost is noise and distractions.

Open offices also exact a greater cost on employee health. For example, a 2014 Swedish study revealed that open office employees were twice as likely to take sick days as employees in traditional office layouts. Regardless of the rest of their job, some employees believe this is too great a price to pay.

Forbes magazine cites a 2005 study from the University of Sydney. The study categorized and rated 303 office environments. Of all the types of office layouts, those employees with the most private workspaces also had the highest job satisfaction. In contrast, employees in open offices had the lowest satisfaction rates.

Lack of ‘sound privacy’ topped the list of negatives from workers regarding open offices. Additionally, other employee negatives were lack of visual privacy, lack of space and annoying noise levels. Significantly, over 25 percent of the employees in open offices expressed dissatisfaction with workplace noise. Interestingly, the study showed no great increase in employee interaction and collaboration when compared to more traditional office layouts. Consequently, open offices increase distractions, decrease productivity, and make employees being twice as likely to get sick at work. Morover, this has led to a backlash against open offices.

Alternatives to the Open Office

BBC Capital says that an estimated 70 percent of US companies have adopted open offices. Yet even with evidence showing them to be less favorable for employees, few businesses have returned to traditional spaces with separate offices. However, some employers are rethinking the concept and are working to remedy the issues.

The Wall Street Journal reports that some companies are establishing ‘quiet zones’, building soundproof rooms and rearranging floor plans in ways that appeal more to employees. These are only a few of the alternative ways that businesses are attempting to decrease distractions, provide more privacy and make workplaces more enjoyable for everyone.

Happy Workers = Increased Productivity

Even though traditional office layouts might not completely supplant open offices, some companies are creating alternatives with more privacy for everyone. And by having happy employees with higher satisfaction, companies can expect to reap the rewards of increased productivity and success.

Creativity, Collaboration and Community

For younger employees, workspaces are not only about getting the job done. Millennials, in particular, seek a greater sense community, notably in their work environment. As a result, office design has moved towards barrier-free, shared spaces. Apart from simply designing office spaces that are open, developers and designers are looking towards layouts that foster community and encourage collaboration and creativity.

Green Office Space

‘Sustainability’ is one of today’s buzzworthy words, yet the concept is more than a fad. As a result, the idea of ‘being green’ and creating sustainable spaces is one that has taken hold in many parts of the nation. There is a push for architects, builders, and landlords to reevaluate tried-and-true methods and explore new avenues for sustainability. In fact, CXRE’s Houston brokers know all about green office spaces.

Green Spaces founder Jennie Niven says that features like rooftops gardens, green walls that incorporate living plants into the office space and on-site composting will become more common in office settings. In addition, other features of 21st-century office space might include additional bike parking to encourage commuting by bike, car-sharing spots, and reclaimed furniture. Also, using alternative energy sources to power the buildings will become much more common throughout the rest of the century.

Flexible Office Space

Flexible workers who can work from anywhere want flexible spaces that encourage collaboration and teamwork. Since many workers use laptops or tablets for their daily tasks, workspaces are more flexible. Not only that, but the proliferation of wireless technologies and devices decreases the need for each and every employee to have dedicated cubicles.

Expanding on the idea of the open office, some companies are embracing flexibility. For example, some simple have stations that anyone can use. Thomas Bercy of Bercy Chen Studio in Austin recently worked on a project for a paperless real estate agency. In the end, the project featured 22 workstations without a single one dedicated to an individual employee.

Not Quite Space Age Offices

As baseball legend Yogi Berra famously said, “The future ain’t what it used to be.” While we’re not quite zipping around in flying cars and don’t have robot maids like the Jetsons, new ideas, new technologies and a new generation of workers are changing the modern office environment.

Even though the office environment may not yet be the space-age vision that people dreamed of half a century ago, many technological improvements and innovations are helping to fashion today’s modern office spaces. No longer is an office simply a place to work. By comparison, the 21st-century office space fully embraces all types of technology. Overall the results are creative, connected, and green work environments.

Share This

CXRE » Houston » Commercial Real Estate Brokers » Configuring Office Buildings for Investors