Real estate is all about
balance

Too much office space is a waste of capital. Too little can hurt productivity.

We help organizations across the globe assess their workplace occupancy strategy to strike the right balance. We surveyed 81 of those companies—with a combined 550 million square feet of office space—and found the following top five global occupancy trends. For a complete snapshot, download our
2017 Occupancy Benchmarking Guide
.

In-office vacancy

  • Overall, companies are getting smarter about their space use. This means decreasing vacancy rates so they’re not paying for empty or underused space. In fact, only 5% of our clients located in the Americas or Asia Pacific have more than 40% of their workstations vacant. In EMEA we’re seeing companies with workstation vacancy rates under 30%.

    Office vacancy will continue to drop as organizations start to monitor real-time utilization, employ mobility programs and incorporate unassigned seating.

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Workplace utilization

  • Utilization—metrics around how and how often space is occupied—is widely considered the “holy grail” of today’s workplace environment. Companies are using several methods to track workplace utilization and make meaningful decisions to right-size their portfolio. Why? Because globally, we see companies underutilizing an average of 30-40% of their space on a typical workday—and that’s among organizations that actually track it.

    When you understand how your office space is used (or not), you can uncover enormous cost savings.

    But not only that. Putting your findings into action will gain you a smarter layout, happier people and a better use of resources.

  • Office space utilization

    Typical utilization rates are between 60-70%.
    This means space is underutilized 30-40% of a typical workday.
  • Utilization by industry

    70-89%
    Communications
    60-69%
    Consumer products
    30-90%
    Financial services
    60-69%
    Healthcare
    50-79%
    Industrial
    80-89%
    Insurance
    80-90%
    Non-profit / Public sector
    50-59%
    Pharmaceuticals
    70-79%
    Professional services
    30-90%
    Technology
    80-89%
    Utilities
  • Methods for tracking Utilization

    45% of clients use manual visual observation methods, while
    55% use technological methods to obtain utilization data.
  • Reasons for tracking utilization

Mobility programs and activity-based offices

  • Companies worldwide are facing continued pressure to deliver an innovative and collaborative workplace while increasing productivity and reducing real estate costs. Mobility programs—programs that provide an activity-based working environment—are an increasingly effective strategy to achieve this goal.

    In a mobile office, employees have more flexibility to work where and how they want, and access to tools that foster collaboration and innovation.

  • Mobility programs by industry

    50%
    Communications
    30%
    Consumer products
    100%
    Education
    50%
    Financial services
    50%
    Healthcare
    25%
    Industrial
    75%
    Pharmaceuticals
    75%
    Professional services
    100%
    Restaurants
    31%
    Technology
    50%
    Utilities
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    For many companies, their employees are already working in more flexible ways. Although some companies offer work from home options, only 45% of clients have a mobility program that includes a structured work from home component. However, 63% of clients with mobility programs have a change management component.

Office space benchmarking

  • It’s no secret that portfolio footprints are shrinking, and subsequently office and workstation sizes. More agile industries like technology and communications are leading the charge, while traditional industries like banks and law firms are decreasing their office sizes a little bit each year.

    While office space continues to shrink, companies are also increasingly aware of the pitfalls of open office environments that went too far.

    Smaller space is certainly more affordable, but you’ll sacrifice effectiveness and employee productivity if it’s not thoughtfully designed.

  • Office size categories

  • The majority of clients have a standard workstation size of 35-49 SF. Across the regions, clients in Asia Pacific have the smallest workstations on average (less than 35 SF) while clients in the Americas have the largest spread and quantity of workstation types, varying from less than 35 SF to more than 65 SF.

     
     
     
     
     
     
  • Office space density per person

  • Office space density per seat

Real estate management technology

  • Real estate is typically the second- or third-largest expense for most organizations. So effectively managing the real estate lifecycle is key to reducing costs and increasing efficiencies. Doing so requires a modular deployment of a strategic, integrated suite of technology.

    Computer-Aided Facility Management (CAFM) technology, more commonly referred to as Integrated Workplace Management System (IWMS) applications, provide an end-to-end suite of tools to manage real estate.

    We’re seeing increased adoption of these space-optimizing technologies. More companies are integrating these systems into their broader real estate portfolio dashboards, databases and technology systems.

  • Technology used when we manage occupancy planning services

    Note: not representative of overall market share

  • Technology used when we consult on services

    Note: not representative of overall market share

The takeaway

We’ve outlined several strategies, tactics and tools that leading companies across the globe are implementing today to better understand and optimize their use of space. Employing the right combination of these can reduce real estate costs, boost employee morale and productivity, and better position your company for future growth.

For more on global office space standards and best practices,
download our complete 2017 Occupancy Benchmarking Guide.

Questions? Contact:

Susan Wasmund

Head of Americas, Occupancy Planning

susan.wasmund@am.jll.com

Julie Brown

Head of APAC/EMEA, Occupancy Planning

julie.brown@eu.jll.com