As the U.S. vaccination drive continues and COVID-19 cases and hospitalizations stand at a fraction of their worst levels, COVID-19 restrictions have been relaxed or removed throughout the country, raising expectations for a faster-than-expected return to the office for white collar workers, many of whom have been working from home for more than a year. States that have been among the hardest hit by the pandemic, such as New York and California, recently removed virtually all restrictions on business activity. In turn, this has had a profound effect on many office occupiers’ plans for their real estate portfolios.
Real estate services firm CBRE reports that while in September of 2020, 39 percent of the office occupiers it surveyed expected to significantly shrink their office portfolios, by April 2021, that figure had fallen to 9 percent. Instead, 72 percent of respondents now expect their office portfolios will shrink “moderately” (vs. 45 percent in September) and 12 percent expect their office portfolios will be larger (vs. 5 percent in September).
In the survey CBRE administered this April, which included 185 corporate real estate decision makers, a plurality of respondents (41 percent) indicated they expected office occupancy to return to a more normal state by the third quarter of this year. As a result, CBRE researcher forecast that a full-scale return to the office will pick up momentum in the second half of this year.
A majority (60 percent) of the survey respondents also indicated that they were planning a hybrid/“guided” flexible approach for their office policies going forward, 30 percent expected employees to come back to the office full-time and another 4 percent envisioned a hybrid/fully flexible approach to office attendance in their organizations. Only a very small minority saw their company’s future as “virtual first” or fully remote (3 percent for both). Eighty-five percent of the surveyed companies want their employees to spend at least half their work week in the office.
Meanwhile, a report released in June by real estate services firm JLL called Worker Preferences Barometer, which collected insights from 3,317 office workers from 10 countries, found increasing burnout surrounding full-time working from home among the people it surveyed. The share of people who felt more productive working at home than in the office fell to 37 percent in March of this year from 48 percent in April 2020. Sixty-one percent said they were craving “real life” human interaction with coworkers and 52 percent said they missed the “change of scenery” working from the office allowed them.
In the following slides, 10 office experts share their views on when a full-scale return to the office will occur and how that return will unfold. While the return timeline is accelerating nationally, there will likely be difference between different regions of the country and companies of different sizes.
