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Unpacking the Cost Factor in Post-Pandemic Office Design

More than half of corporate employers expect employees to work from home two days a week on average, according to the latest JLL Research. That has significant implications not only for office design post-pandemic, but also for buildout costs.

“With any given employee not in the office two days a week, fewer companies will provide every employee a permanent and dedicated desk,” JLL’s Henry D’Esposito writes in the 2021 edition of the firm’s office construction cost benchmarking report. “Instead, some future office designs will place a greater emphasis on custom collaboration and community spaces, with a smaller share of the office footprint dedicated to standard workstations.”

From a cost perspective, writes D’Esposito, this means a more carefully designed and customized office that meets the needs of multiple overlapping users on any given day. “On a per square foot basis, the cost of a mobility and collaboration focused office design will generally be higher than a standard layout with primarily dedicated workstations. Hard costs are higher, as less of the footprint is given to simple open spaces that will be filled with rows of workstations. On the other hand, some occupiers may consider slightly smaller footprints given that fewer employees will be using the office at a time.”

Along with adapting to a partially remote workforce, another factor to consider this year will be technology-centric design to support new ways of working. Although office users got by with makeshift remote setups during the pandemic, “a permanent shift to virtual collaboration will require a reimagination of the technology setups in many existing office designs today,” D’Esposito writes.

He reports that a future workplace designed for a mobility-focused and partly remote workforce will include a greater share of conference rooms, huddle rooms and flexibility collaboration spaces that allow for video calls and presentations designed for a virtual-first environment.

Here, writes D’Esposito, “the cost implications will directly depend on both the scope and the quality of the technology being integrated into a workplace. Within each project budget, the share of spend being dedicated to technology is expected to grow for most companies over the coming years.

“This is not an area where savings are expected due to densification or any downsizing in office footprints. Anyone planning to build or renovate an office this year should carefully reconsider any technology budget based on past assumptions, and exercise caution before relying on benchmarks from previous years.“

Another byproduct of the pandemic will be a focus on wellness and sustainability integrated throughout office design. “Pandemic-specific measures will subside in tandem with the pandemic, but the increased awareness and focus on health and well-being in the office environment will be permanent,” writes D’Esposito. “More considerations will be placed on sustainability certifications.”

Those certifications represent their own set of cost implications. “The upfront cost of any sustainability or wellness certification generally includes both higher construction costs and a fee to apply for and receive the certification,” D’Esposito writes. “Over time, any energy efficiency gains realized in the process of sustainability certification will usually pay for themselves.”

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About Paul Bubny

Paul Bubny serves as Senior Content Director for Connect Commercial Real Estate, a role to which he brings 13-plus years’ experience covering the commercial real estate industry and 30-plus years in business-to-business journalism. In this capacity, he oversees daily operations while also reporting on both local/regional markets and national trends, covering individual transactions across all property types as well as delving into broader subject matter. He produces 15-20 daily news stories per day and also works with the Connect team and clients to develop longer-form content, ranging from Q&As to thought-leadership pieces. Prior to joining Connect, Paul was Managing Editor for both Real Estate Forum and GlobeSt.com at American Lawyer Media, where he oversaw operations at both publications while also producing daily news and feature-length articles. His tenure in B2B publishing stretches back into the print era, and he has served as Editor in Chief on four national trade publications.

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