Around the globe, all facets of the commercial real estate industry have been substantially impacted by the ongoing pandemic and the resulting economic ramifications. While the crisis created numerous unique challenges for the industry, leading to CRE undergoing significant changes, it also gave birth to innovative opportunities- accelerating several trends.
Here is a look at some of the important trends shaping commercial real estate currently:
1. Reduction in office space sizes: Last year and this year saw many employees working from home or near home. Additionally, many organisations also started adapting hybrid work models with employees alternating between in premises work and work from home certain days of the workweek. These changes are sure to reduce the need of large offices leading to a reduction in office sizes with companies preferring to set up smaller, flexible offices in multiple locations.
2. Health and safety are taking centre stage: As organisations welcome back their workforce in full swing to offices, they must support their health and safety. As such, commercial real estate will have to be ready, agile and adopt modern technologies that enable staff to avoid contact with used surfaces such as meeting room booking screen, lift buttons, light switches, and other major touch points much more in their office spaces. CRE needs to step up as organisations are looking for a safe and healthy environment that involve touchless services and traditional processes driven by automation.
3. Changes in office layouts: The pandemic has forced many organisations to revamp their real estate portfolios- opting for smaller, satellite offices across multiple locations that are integrated with advanced technology infrastructure and multi-functional meeting spaces. Most companies currently are looking for intelligent workplace solutions where technology will allow people to work faster and better. Some of the technological enhancements that organisations are in favour of include space awareness technology enabled by sensors and seamless, touchless transactions.
4. Flexible workspaces and hybrid work models: Today, one thing is quite clear that the demand for a traditional physical office is not going away any time soon, but the pandemic has brought about a shift in the priorities of many organisations where they are now emphasizing more on concepts such as smart technology, safety, and sustainability. Flexible workspaces and rise of the hybrid work model are two trends that has had a considerable impact on occupier’s decisions. This is because many occupiers are looking to cut down operational costs by offering flexibility to their employees and favouring decentralization.
5. CRE trends centered around digital transformation: CRE is actively embracing digital transformation with many in the CRE sector looking to integrate technology in its everyday operations that will help in improving the tenant experience pertaining to sustainability, safety, and leasing. Since safety has been on top of the priority list for many occupiers, to keep the premises secure and ensure a smooth visitor experience, several CRE professionals have adopted technology to optimise lobby operations and integrated mobile based visitor management system in their buildings. Additionally, technologies like VR and AI are gaining importance and being used in various stages of project execution to improve the user experience even more.
There is no doubt that the pandemic has highlighted the need for innovation in CRE and accelerated the growth of trends that will carry over in the coming years. With customer preferences changing rapidly along with increasing influence of advanced technology, it is imperative for commercial real estate to take note of these emerging trends and undergo a swift transformation – putting the end user’s needs at the forefront.