It’s been said again and again. The pandemic has meant changes to how employees work. As a follow-up, it’s also led to changes in the workplaces where these employees operate.

Another follow-up issue is the costs of re-fitting and re-designing workspaces to support remote and on-site efforts. JLL’s “U.S. and Canada Design Trends and Cost Guide” attempts to answer this and other questions by providing an overview of evolving office design, considerations for re-fits and their costs. These dollar amounts are based on an analysis of 4,900 projects completed by JLL and checking in with more than 700 clients across myriad industries.

Evolving Office Designs

The JLL guide explained that we’re in a period of “the stabilization of hybrid working patterns.” Effective on-site workspace should “support collaboration, focused work, sound privacy and the integration of technology.”

Another consideration is sustainability (with companies more involved with net-zero goals) and the increasing demand for low-carbon offices. Finally, hybrid work environments, especially those that account for in-person and virtual collaboration, are more complex.

The report noted that some of the factors to consider when determining fit-outs and their costs include the following:

• Regional differences and state-specific factors

• Market demand

• Tenant preferences and employee well-being

• Sustainability and energy efficiency

• Technology integration

How Much DO Things Cost?

Getting to the nitty-gritty, the guide outlined “a comprehensive data-driven reference that provides a comparison of average fit-out costs across major U.S. and Canadian markets.” The guide’s authors cautioned that the costs vary based on the project scope and user requirements. The information also assumes a fit-out from a warm lit shell condition.

The following is an overview of JLL costs per rentable square foot of fit-outs:

And . . . the Outlook

The guide’s authors anticipated that “the construction sector in the United States is bracing for a year of mixed outcomes in 2024.” As contractors continue to boost backlogs and deal with labor retention issues, margins “are anticipated to come under pressure.” Speaking of labor, a shortage of it could also likely increase construction costs.

However, a slowdown in construction activity has helped put a damper on price increases in North America. Material costs are anticipated to remain stable, but finished goods face “evolving standards and heightened demand.” The potential supply chain disruptions due to global events could also be problematic. With the above in mind, “cost increases in 2024 are expected to remain in the range of historical average growth, but may move more in reaction to continued uncertainty,” the guide’s authors.