From floor plans to location, adding new space to a company’s real estate portfolio can be a painstakingly comprehensive process. But once the ink has dried, it’s the people who work within that space who will determine that company’s success. So it stands to reason: When it comes to real estate, shouldn’t we consider the workplace experience as much as we do the bottom line?
That was the question posed last month at WeWork’s “Humanize San Francisco,” an experiential real estate event in the heart of wine country. Along with the chance to connect with industry peers and experience the beauty of the Napa vineyards, guests at Humanize were taking part in something bigger than themselves: They were sharing in the knowledge that their collective actions have a direct impact on more than 1 million people.
That’s not a typo—the average enterprise-level company has thousands of employees, and only one chief head of real estate. When employees are spending upward of 40 hours a week in the office, it starts to become clear how much heads of real estate affect their businesses through the spaces they provide.
At Humanize, attendees explored the many ways in which real estate fits into the larger business ecosystem. Workspace, and the experience employees have within it, has always been closely tied to a business’s bottom line—but how will that evolve over time? This concept of the future of work garnered much discussion from the Humanize speakers. They saw two trends that will fundamentally shape real estate in the years to come: the rise of the human-centric workplace and agile real estate.
The human-centric workplace
Today, employees expect more from their workplaces than ever. And it’s no wonder: The average person spends 90,000 hours at work in their lifetime.
As such, workplace fulfillment is an imperative. “The whole myth that work doesn’t have to play a fulfilling role in our lives simply isn’t true,” explained Aaron Hurst, CEO and cofounder of peer coaching company Imperative and the Taproot Foundation. “Research shows that we cannot be fulfilled in life if we’re not fulfilled at work.”
How then can company leaders create workspaces in which employees feel fulfilled?
Robinson explained that employees at every company have the same need for human connection. “When you get down to it, no matter how big or small the business, we all want the same thing out of work,” he said. “We all want to feel connection; we all want to feel growth. We all want to feel like what we’re tied to something really important, that we’re making a difference.”
These days, it’s vital for the employer to be the facilitator of in-person connection, so work itself takes on a whole new meaning—and exists in alignment with each employee’s values.
That’s why workplaces are being designed with more empathy for employees. Corinne Murray, head of activity-based workplace practice at WeWork, believes the modern workplace is becoming increasingly human-centric. “Measuring efficiency as total usable square feet divided by the total population is an abstract formula that doesn’t account for how people actually experience their workplaces,” said Murray. Rather than being designed only for efficiency, workspaces will be built to give employees the best experience possible. This means that employees can find—and be free to use—the space types they need at any particular moment: common areas to connect, conference rooms to meet, and quiet spaces to focus.
AECOM, the multinational engineering giant, is one company that’s making this shift to activity-based working (ABW). “ABW allows employees to choose how and where they work best within our office space,” said Luigi Sciabarrasi, senior vice president and global real estate lead at AECOM. “Through this approach, not only have we been able to listen and respond to what our employees need, but we’ve been able to drop five million square feet of real estate by optimizing our portfolio.”
Technology can also play a role in better connecting businesses to their employees—whether that’s understanding how conference rooms are being used day-to-day, or how different teams leverage a diversity of space types. “Ultimately, technology allows us to better understand and respond to our employees’ needs within the workspace,” said Zachary Holmquist, senior director of product at WeWork. “Because of that, data-driven decision-making has the ability to strengthen the connection between employers and their teams.”
Agile real estate
So if companies need to rethink the types of spaces they offer employees, they also need to reconsider how they source spaces. Despite businesses having to change and adapt more quickly than ever, the traditional real estate process has remained unchanged.
Leases remain inflexible, and—especially in today’s unpredictable business climate—high risk.
“Why take on a 15-year traditional lease when head count is rarely planned for more than three years out?” asked John Lewis, head of global real estate advisory at WeWork. “By embracing agility, WeWork is disrupting the traditional model,” said Lewis. “We’re looking at real estate as a liquid, not a static, asset.”
In addition to providing enterprise companies with flexibility, agile real estate also helps build communities, according to Robinson of WeWork’s Powered by We. “Flexible working environments benefit companies of all sizes, from startups to large enterprises,” he said. “Employees are having a better workplace experience, while at the same time, businesses are able to run a more efficient real estate portfolio—we’ve found that WeWork offices are 2.5 times more efficient than traditional office space.”
Agility and your people: putting the two together
While agile real estate and human-centric workplaces are inevitable, real estate leaders need to be change agents within their companies. It’s vital that they examine their impact on the people around them, as well as on their business—because when it comes down to it, the two are forever linked.
“WeWork is creating a world where people can make a life, not just a living—and real estate has an incredibly important role in elevating the employee experience,” said Robinson. “We’re on this journey together—this is our community. And we’re just getting started.”
WeWork offers companies of all sizes space solutions that help solve their biggest business challenges.