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Leaner and Greener: 2015 Office Space Trends

Posted On January 28, 2015

BBG office blog Creative Commons photo PixabayLandlords are in luck. Looking at office sector performance for the next year or so, things look favorable for property owners, with rents and occupancy both expected to rise in most major markets. Contributing to the sector’s success are job creation, continued technology growth and the limited supply of suitable office space on the market.

Besides overall strength, BBG sees other trends taking shape for the office sector in 2015. Some bode well for the sector’s continued success, while others point to challenges in the not-too-distant future. Here, we discuss three significant office sector trends; as always, we welcome readers’ perspectives.

Backlash against open office design. Recent headlines reveal just how far this workspace fad has fallen out of favor: “Google got it wrong: The open-office trend is destroying the workplace” (Washington Post); “Offices for all! Why open-office layouts are bad for employees, bosses and productivity” (Fast Company); “Ending the tyranny of the open-plan office” (Businessweek). Regardless, the International Facility Management Association reports that about 70 percent of U.S. offices have no or low partitions.

Open floorplans allow bosses to keep a closer eye on employees and are said to foster collaboration, but as it turns out, they don’t actually improve productivity. In fact, a 2011 meta-analysis of research on open-plan offices determined that the environment and its inevitable distractions worsen workers’ attention spans, productivity, creativity and job satisfaction. Furthermore, one study found that employees without their own closed offices take more sick days.

Still, open offices have staying power because the shared spaces save money. In addition, millennials — who will dominate the workforce — tend not to mind them as much. The incubator concept for startups also drives demand for collaborative workspaces.

Law firm shrinkage. Big, imposing offices used to assure clients of a law firm’s eminence, but now they are seen as a wasteful extravagance reflected on clients’ bills. Even where client perception isn’t at stake, law firms are shrinking their footprint to address a supply-demand imbalance. The market for high-end legal services is not expected to return to its pre-recessionary state, so law firms’ space-hogging ways simply aren’t sustainable.

According to an American Lawyer report, law firms typically occupy two or three times as much space per employee as banking, insurance or technology firms. Now, along with downsizing, law firms are embracing new workplace designs along the lines of their corporate clients; in fact, they will come to look more like business consulting firms with smaller, flexible, collaborative workspaces, according to the “law office of the future” project by the architecture firm Gensler. Already, law firms have begun to use standard-size offices to promote collegiality and teamwork.

Gensler predicts that efficiency will prevail and law firms will adapt into “progressive layouts” with no assigned offices. While this might not please a firm’s partners, Gensler-funded research has found that younger attorneys want to work from home sometimes, anyway.

Quantifying sustainability. Consumers, stockholders and employees have long expected corporations to make demonstrable efforts to “go green.” But the way companies show compliance has begun to change, and it’s not just the public who wants accountability.

A decade ago, companies commonly engaged in “conspicuous conservation,” flaunting solar panels, LEED certification plaques and other obvious signs of greenness. But what we know today is that renovated buildings outperform new buildings on energy savings in every category including offices and mixed-use structures. The research findings have given rise to what preservationist Mike Jackson dubbed the “stealth green” practice of greening up old buildings. Often, the degree to which the exterior is kept the same is seen by the public and press as a sign of greenness.

We are fast approaching the point where positive press, third-party certifications and corporate sustainability reports aren’t proof enough that companies are doing their part. In 2009, New York City passed a law requiring all privately owned buildings to measure and report their energy consumption and greenhouse gas emissions; 2014 was the first year they were required to make the data public. NYC’s example as well as insights gleaned from the massive amount of data are expected to shape policy elsewhere.

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