Looking Back on the Changes Made to the Workplace Due to COVID-19

Posted on August 18th, 2021

COVID-19 left no industry untouched. Many businesses spent the early months of last year racing against the clock to adapt their spaces and operations to meet new health regulations, however, the new normal seems to keep raising more and more changes to the work environment as we know it. Whether they are retail or office based, companies around the world are still trying to come to grips with the new office paradigm in which safety and flexibility are paramount.

One of the most important elements of the post-pandemic work environment was the addition of social distancing regulations. These varied from country to country and from industry to industry, however, official guidance generally required businesses to ensure staff and customers were always at least 6 feet apart. These regulations seem to be easing across the globe as vaccines continue to roll-out and the threat of the pandemic begins to subside, although it is expected that varying levels of regulation will be upheld until the start of 2023.

Beyond this measure, businesses are continuing to play it safe and take additional steps to reduce risks, bolster their amenities, and make changes to the work environment as needed. Key methods of continued risk-prevention include:

  •  Increasing the number of no-touch surfaces, such as faucets, door handles, rubbish bins, etc.
  •  Providing resources to staff to ensure they follow health guidelines regarding hand washing and sanitizing.
  •  Stepping up the cleaning and disinfection schedule using approved products.
  •  Improving building ventilation by supplementing HVAC systems with outdoor ventilation where air quality permits it, switching to the highest possible level of central air filtration, and keeping ventilation systems running for as long as possible even after the working day is over.
  •  Incentivizing mobility alternatives that facilitate social distancing. This could mean encouraging remote work, walking, carpooling, or cycling to the office instead of using public transport.

Hybrid Working Practices: Another Aspect of The New Normal

Flexible work arrangements served as an effective way of maintaining a healthy work environment during the pandemic downtime. So much so, that flexible and hybrid working practices could very well be here to stay. Some of the world’s most influential businesses (including tech giants in Silicon Valley) have jumped on the remote working bandwagon and championed it as a long-term trend that is set to become the rule rather than the exception.

To comply with social distancing regulations, some businesses limited the number of employees allowed in the workplace at the same time. This required finding alternatives to keep their workforce productive while keeping occupancy rates low. For many, this has meant rethinking their corporate real estate strategy and moving away from permanent office space by encouraging remote work.

But effective hybrid work arrangements mean more than having employees work from home. Switching to a virtual workplace successfully involves empowering staff with the tools and resources they need to make the transition easier. This could mean digitizing information management systems, developing proprietary software, and using asynchronous team communication tools if the workforce is geographically spread out.

Flexible hours and remote meetings can also help comply with social distancing requirements. Some other options that may work include:

  •  Staggering start and end times to reduce commuting at peak times.
  •  Implementing rotating shifts.

The flexibility and changes to work practices we have witnessed over the last 18 months have dramatically expanded our previous notions of productivity and, if implemented wisely, they may pave the way for a better work-life balance and increased employee satisfaction.

Cost of an Office Fit-Out or Renovation in the USA

Posted on July 21st, 2021

Office renovations can help create a more productive workplace and support a business’s branding strategy. However, these projects can have a significant impact on capital expenditure. Calculated per rentable square foot (RSF), fit-out and renovation costs went ranged from $90 to $220/RSF in 2019-20, depending on location, office size, cost of labor, and industry sector – since some businesses (such as tech companies) require fit-outs to higher and more costly specifications.

What follows is a breakdown of the costs involved in renovating an office in the United States. *

Construction Costs

These costs involve the removal, addition or alteration of physical elements in a building, office floor or office unit. Construction costs include materials and labor, as well as fees charged by contractors, and they serve as the biggest expense in fit-out projects – accounting for 50% to 70% of the total cost.

Average costs are $90/RSF. Depending on location, they can be as high as $139/RSF or as low as $54/RSF.

Read More »

Office Features to Look Out for in the Second Half of 2021

Posted on June 23rd, 2021

The US office market has been dramatically transformed by the changes to work practices and mobility restrictions implemented throughout the course of 2020 and early 2021. Whilst it was predicted that the market would slowly rebound starting in recent months, the demands of office occupiers will have changed substantially since the start of the COVID-19 pandemic. Below is a brief overview of the main things to look for in an office space during the second half of 2021.

Office Layout

Flexible spaces

Flexibility remains a key consideration when choosing an office, not only in terms of lease terms, but also office layouts. Many office-based companies are still unsure about their ability to retain staff in the face of reduced revenue, combating this uncertainty by implementing rotating shifts or flexible work hours, two factors which have ultimately led to businesses struggling to identify the total headcount in the office at any given time.

This uncertainty will lead to an increase in demand for modular spaces that can be adjusted depending on the number of people present in the workplace. These kinds of dynamic layouts have been an option for several years, often going hand in hand with trends towards multi-functional office spaces. Some of the main elements that typify flexible workspaces include:

  •  Blurred indoor to outdoor transitions.
  •  Movable walls and room dividers.
  •  Lightweight or mobile office furniture.
  •  Adjustable or movable lighting.

Read More »

A Guide to Subleasing in The United States

Posted on April 22nd, 2021

A sublease is an agreement between a party who already hold a lease to a property and a separate party looking to rent the property in question, whether that be partly or wholly. For example, a business who leases five floors of office space in a building may look to sublease one of those floors, in the event that they downsize their workforce prior to the end of the initial lease. The party who holds in initial lease is known as the sublessor, whilst the third party looking to occupy a part of the leased space is the sublessee.

How to Sublease

The first step is to check whether you need your landlord’s written permission to sublease a property. This should be outlined in your lease agreement. If subleasing is permitted, the agreement may also specify whether you’re required to give notice to your landlord.

Next, make sure you’re familiar with the legal aspects of subletting in your area, since every state has its own sublet laws that take precedence over lease agreements. You can check state-by-state details here.

Read More »

Quick Glossary of Commercial Real Estate Terms

Posted on March 22nd, 2021

There are certain terms you need to be familiar with when renting commercial property in the United States. Here is a list of the most important key words, in alphabetical order.

All-Inclusive

All-inclusive space is available at a fixed fee and typically gives tenants access to equipped workstations, admin/reception support, and meeting rooms. Utilities, janitorial services, and security are usually included.

Class A/B/C

Office space is classified into three classes depending on quality standards and the amenities on offer.

Class A

Class A space is considered best-in-class and is usually located in new buildings that feature the highest standards of construction, design, and amenities. These offices are typically found in prime business locations.

Class B

Class B space offers a functional standard of accommodation to office-based businesses in need of well-maintained space at a reasonable price.

Read More »

United States Commercial Property Supply and Vacancy Rates 2021 (Part 2)

Posted on February 25th, 2021

In a previous blog post we examined the performance of the commercial real estate market in some major US cities. This is the second article in this series, which uses data from late 2020 and early 2021 to examine vacancy and supply rates in cities such as Los Angeles, Chicago, Atlanta and Houston. These statistics illustrate the impact of COVID-19 on the commercial property rental market, as well as the types of properties that are holding strong in the face of negative trends.

Los Angeles

Los Angeles is a hub for creative, media, and entertainment companies, many of which are office-based. The city’s proximity to major cargo ports makes it convenient for logistics and distribution businesses, both of which have kept the industrial real estate market strong.

Offices

  •  Vacancy rates in downtown Los Angeles are 21.5%.
  •  In Q4 20202, there was more than 5.5 million square feet for vacant space, with 3.4 million feet being in the Financial District.
  •  The majority of vacant inventory involves Class A offices.
  •  Supply increased by more than 2 million square feet in the past 12 months.
  •  No new supply is expected to enter the market as no projects are currently under construction in the CBD area.
  •  Vacancy rates average 22.5% outside of the CBD, however, they reach 56% in the Fashion District.
  •  Vacancy rates are just under 18% in the Greater Los Angeles area.

Read More »

United States Commercial Property Supply and Vacancy Rates 2021 (Part 1)

Posted on February 11th, 2021

With a market size of nearly $900bn, the United States has one of the world’s largest commercial real estate markets, coupled with some of the most desirable business locations to match. This post serves as the first part of our examination into the US market’s performance based on data from Q4 2020 and Q1 2021.

Read More »

Atlanta’s Tech Square

Posted on February 6th, 2021

Tech Square is a rapidly developing neighborhood covering a total of approximately 8 acres. The area is located in Midtown Atlanta, between 3rd and 8th Streets in their intersection with Williams and West Peachtree. Approximately 3 miles north of downtown Atlanta, Tech Square can be accessed via bike lanes, mass transit, and two interstate roads.

The development of Tech Square is part of a revitalization project that has been transforming the face of Midtown since the early 2000s. Today, the area is known for its bustling character and high business density, especially in the creative and tech sectors.

The creation of this new district has put Atlanta’s office market in the spotlight. The city is now considered a robust secondary market with strong fundamentals and millions of square feet under construction. The largest sub-markets are the CBD, Midtown, and Buckhead. Approximately half of Atlanta’s total office inventory is Class A space, which is particularly abundant in Tech Square.

Read More »

United States Office Rental Market – Trends for 2021

Posted on January 27th, 2021

Commercial real estate was one of the hardest hit sectors following the coronavirus outbreak in 2020. The pandemic and the measures taken to curb its spread brought significant changes to office-based workplaces, driving a sharp and sudden increase in remote work practices. The most immediate consequence of this shift was a softening in rental activity due to the decreased need for physical office space in the short-term. As a result, 2020 ended with a marked decline in take-up volume and an increase in office vacancy rates across the nation.

The United States office rental market entered the new year in a scenario marked by declining rental rates and compromised fundamentals. As we move further into 2021, these trends are likely to remain in place and some markets may begin to feel the full impact of the economic crisis, whereas others will prove more resilient.

Read More »

Working in the Clouds: An Exploration into ‘Skyscraper Cities’ and the Benefits of Working in Modern High-Rises

Posted on January 22nd, 2021

The United States has a long history of being at the forefront of architecture.  In fact, the world’s first modern skyscraper was built in the city of Chicago in 1885. That decade saw impressive buildings built to reach for the sky, mainly in cities that were bustling with trade and business activity.

Many of those buildings still stand tall, along with a wide range of others that have been built over the years. The US cities with the highest density of skyscrapers include:

  •   New York, which ranks third in the world due to its skyscraper count, with more than 280 high rises of 150+ meters.
  •   Chicago, also in the global top 10, with 126 skyscrapers.
  •   Miami, with 54.
  •   Houston, with 39.
  •   Los Angeles and San Francisco, with 26 and 25, respectively.
  •   Boston and Seattle, with 21 each.
  •   Las Vegas and Philadelphia, with 14 and 13, respectively.

Read More »