HOW WILL COVID-19 CHANGE THE DEMAND FOR OFFICE SPACE?


By: Alexander Hartmann

Managing Partner
The Loft Bureau Real Estate LLC

While Qatar is facing a possible second wave of restrictions due to COVID-19, many other countries have already gone through it and are preparing for a gradual lifting of measures. During this global pandemic companies around the world including
Qatar have realized that the way they work will drastically change over the long term. Previously, design firms, industry specialists, and academic researchers speculated on the efficacy of open offices, team-based workspaces, self-employment and co-working, occupant loads, real estate efficiency, mobility, flexibility, communications tools, and artificial intelligence.

Today, the world is different than one year ago. We are facing a series of challenges that, whether new or not, are of a magnitude never faced before. The solutions that worked yesterday, do not work anymore today. The world needs new solutions, new answers, and overall innovation is needed.

Company managers today are thinking much differently about above-mentioned topics compared to pre-COVID days. Work-from-home orders around the world made them rethink the organization of their operations. Consequently, professionals are reconsidering and even predicting the reversal of some of these trends.

One trend undergoing reversal is the increase in population densities in team-based, open office configurations. The question of the hour is “Which steps can be taken, and design features can be implemented to de densify to create the physical distancing that we now and in the future need to have?”

To cater to this changed situation new COVID-19 protocols will determine the layout of future workspaces which will be characterized by greater physical separation via spatial, physical, and temporal means. Workstations will be spaced further apart, conference rooms depopulated, space-dividing partitions erected, and staff issued rotating schedules. For example, a portion of employees will come to the office on a certain day and if necessarily required, while the rest will work remotely. Modern tech companies like Facebook and Twitter but also traditional businesses like Morgan Stanley have already proven during this pandemic that they can successfully operate with no footprint, questioning the future demand for office space. I know from many of our clients here in Doha that they are still working remotely respectively that they are considering downsizing their existing office space in the future as their teams will continue to work more remotely in the future. The impact on the office market in Doha remains to be seen.

However, I think that commercial building owners and group CEOs are fully aware that we may see a different local office market post COVID-19. The most important question for them at this moment should be “Is commercial office space no longer relevant as the design of workspaces changes compared to today?”

For sure, the new trends carry significant financial, social, and psychological impact. Are we facing a mass exodus from office space? Imagine such a scenario and its impact on the economy – a deep recession would be one of the negative results from such a movement.

Another aspect are the challenges related to a work-from-home scenario for employees which among others are the sense of alienation and loss of community, the lack of access to particular tools or resources and for family members the possible distractions arising from multiple individuals under the same roof.

Recently I attended a very fruitful and interesting webinar about the future design of a workplace. The host was JLL who invited a handful of interesting guests to speak about the changes of a workspace in a post-COVID era. The picture which was drawn there was very much in line with my own opinion. Yes, there will be changes in the future which are going to determine the design of new office space, but the likely reality is that we will return to a collective workplace. We cannot consider current trends to determine the future design for workspaces, but we may look at the key aspects of office design and make necessary adjustments to consider the implications related to COVID-19. For example, community is an intrinsic human need, yet so is wellness. It is a proven fact that humans with many close social contacts are much healthier than those who are isolated and alone.

Another aspect which supports my opinion, is that an employee’s loyalty and brand identification won’t be established overnight. Usually, it takes time for an employee to identify himself with the company and its culture. Such strong emotions will only grow when the employee can make live experiences with his colleagues on company owned premises. But not only will open space offices change, co- working spaces are similarly threatened. Fuelled by the rise in self-employment and individuals’ desire to connect to a larger community, co-working environments not only in global metropolises but also in Doha have grown dramatically in recent years. However, even after stay-at-home rules are lifted, workers are unlikely to return in the same numbers for fear of contagion. Based on my conversations with some of the local market leaders for co-working space, I expect demand in this segment to be different from the original pre-COVID forecasts.

In result, it is obvious to see that employers are urged to adjust their office layout to meet new workforce expectations. Their employees won’t necessarily want to work from home, but they want and need to have options of workspaces available for them on demand. Therefore, a more collective team approach rather than a focus on individual work will determine the future design of office space. I guess we are all looking forward to experiencing these new offices sooner rather than later!

This article was published as part of the fifth edition of Property Finder Qatar’s Trends Report