“It’s a time of significant challenge and change for corporate real estate, as it is for most sectors of the economy. But opportunities also lie ahead for those willing to adapt.” That’s from a recent report from Allwork.Space. The report focuses on three areas: ESG, productivity, and space-as-a-service in the year ahead.
1. ESG momentum will increase
“Environmental, social and governance (ESG) will be one of the biggest CRE trends in 2023, says Tori Shepherd, Manager, Asia Pacific at the International Well Building Institute. “While ESG has been growing significantly over the past few years, it cannot be ignored in 2023. Globally, the regulatory environment has already shifted or is anticipated to start mandating climate disclosure for public companies.”
2. Productivity
Productivity is the value proposition that CRE will—and should—focus on in 2023, said John Williams, Chief Marketing Officer at Instant. “For the office to find its purpose,” he says, “it has to not only create the optimal environments to enhance productivity but also take giant strides in measuring its impact in this area. Business leaders don’t want to know about headline rents per sq. ft. or lease lengths; they want to know if their workforce is happy, and getting more done.”
In 2023, it will be up to CRE leaders to find ways to quantify the productivity gains their real estate offering can produce, and communicate these to prospective tenants effectively, the article notes. “It should be the simplest thing in the world for those selling the office to their customers to show how their businesses will benefit from investing in that space,” says Williams.
3. Space-as-a-service
“Since the pandemic, companies have been migrating away from more traditional CRE setups to the space-as-a-service model,” the article noted, “with an increase in demand for flexible workspaces from both small and medium-sized enterprises and large companies. In April 2022, Research Dive published a report predicting the significant growth of the space-as-a-service market over the next few years.”
“If workspace is going to mature as a sector, then it needs to drop the anachronisms of CRE generations past and start talking in a language that is meaningful to business leaders—and demonstrating that the office is a place to drive productivity, not constrain it,” said Williams.
“To do this takes well-designed, amenity-rich space in locations where teams either want to come together or find time and space to focus,” he said. Successful flexible workspace operators ‘get’ this. Commercial real estate is no longer a hill to bury money in, but is another service competing with cafes, restaurants, hotels, and gyms.”
Editor’s Note: This article is part of the Allwork.Space 2023 Future of Work Forecast. Click here to read about other trends expected in the new year.