As workers become more comfortable in their remote offices, is it likely that they’ll return on-site after the pandemic? The results of a Forbes 500 CEO poll in early May show that only 40% of those surveyed said that at least 90% of their workers will continue to work from home until next June – and 26% say they’ll never come back to the office. In both large and small companies, the virtual workplace is not going away. Yet, most of us have built our businesses with the physical workplace at its core. We value the togetherness, the community, and the collaboration that comes with that. But we are forced to shift, and for a long enough period to get used to it. We found ways to collaborate virtually, and the work still gets done.
But it’s not the same. Although the work gets done, it’s still not the same. Our team craves the chance to be back in the same space, spending time bonding with each other, brainstorming, and innovating together. But office spaces can be costly – is it worth it for camaraderie and inspiration? These are the considerations business leaders should weigh to maximize a good thing (work from home, save a lot) while minimizing the bad thing (loss of togetherness) to find the best solution for your team and company.
The lease itself is a big expense, and adding in the cost of phones, utilities, furniture, and other expenses of having people in the office can add up. Of course, having employees working from home does have associated costs. Still, it pales in comparison to the infrastructure of the office even if you’re paying for their internet, cell phone, and ergonomic equipment.
Collaboration and Culture
One key reason for office spaces is to facilitate collaboration and knowledge sharing. It’s more challenging to build the trust necessary for strong teams without in-person engagement, or at least that’s been the traditional mantra supporting the need for togetherness in offices. However, many companies build successful virtual teams. Consider more intentional team building to foster vulnerability and trust, or consider a collaboration space such as WeWork or ThinkSpace for your recurring meetings. I wonder if that’s sufficient – or maybe it’s just enough, especially since we’re accustomed to collaborating virtually.
We cannot forget the hours and hours (and frustration) employees take to commute to the office. A work from home model certainly saves time and the associated money. This must be weighed against the benefits of collaboration and culture above.
What about your current office lease?
Once the factors above are analyzed, the next question is whether you could get out of your lease even if you wanted to do so. Businesses are frustrated because they are paying for space they have not used in months, and landlords are not typically open to rent forgiveness or abatement.
Why would the landlord consider releasing you from the lease? I’ve seen companies with both short and long lease terms be able to negotiate an exit, so it’s worth evaluating. You should review your lease for any legal “outs” but also consider the economics for the landlord and yourself. Remember that landlords are struggling with many tenants’ inability to pay, so they may be open to an option for a chunk of change in their pockets. The landlord will weigh the benefit of immediate cash against your future inability to pay, along with the cost of reletting your space. Certainly, some will opt for the buyout.
Landlords also recognize the shift that’s coming in the commercial real estate market. Business owners are assessing the value of their space and planning for how to pivot in the new marketplace.
We’ve got an opportunity to look hard at our old habits and make a choice for the future. Be intentional about what your business and team need for success.
Legal Disclaimer: This article contains general information and should not be viewed as legal advice. You should talk with counsel familiar with your unique business needs before taking or refraining from any action.