2021 Holds Optimism for the Office Sector
2020 was a grim year for the office sector. With the majority of office workers transitioning to remote work, many wondered if the days of water cooler chats and camaraderie with co-workers were officially over.
Although the ability to work remotely has been a saving grace for many corporations during the pandemic, there is optimism that staff will begin returning to work in an office setting and there will be a robust demand for office space.
Ninety-five percent of workers are eager to return to the office days of old, and for a number of good reasons. Productivity and the opportunity to learn dramatically increase when employees are in an office setting. In addition, good work is more likely to be noticed when supervisors are working side-by-side with their staff. It’s also been mentioned that working from home can cause employee burn-out; work becomes exclusively a task-based undertaking, and all the cultural aspects have been removed.
Employers are equally eager to have their team back together in the office. Communication flows better in a face-to-face setting, resulting in better productivity and quality of work. Employers will have to continue to be flexible with their staff, allowing for hybrid schedules that split their time between home and the office.
The robust demand for office space that was mentioned above will be due to a couple of factors. As our economy rebounds so the will office sector, which is often linked to a booming economy. The U.S. is forecast to create five million new office-using jobs this decade, and that projection hasn’t been affected by the pandemic. The tech industry in particular is projected to hire hundreds of thousands of new office workers in 2021 alone.
As employers work to create health and safety protocols in the office, the open concept workspace may become a thing of the past, resulting in office tenants needing more space, not less. Private offices and cubicles will be back in style, and conference rooms and break rooms will be adjusted and expanded to provide more space and distancing.
The overwhelming number of employees and employers that want to re-enter the office, coupled with a rebounding demand for office space creates light at the end of the tunnel for the office sector.
Justin Langlois, CCIM is a Commercial Real Estate Investment Advisor with Stirling Properties servicing Baton Rouge, Louisiana and surrounding markets. Please reach out to Justin to discuss your real estate investment strategies.