I’ve been reading and thinking lately about how the ability to work from home will influence the future of work, and in particular the future of commercial real estate. For nearly all of my work career, there was never a thought given to the ability to work somewhere other than the office.
The concept of “butts in seats” never occurred to companies in the 80’s and 90’s up until just a few years ago, because we worked at work. Even my most recent manager, with half of his team already working in remote locations around the country, was highly resistant to the idea of his Charlotte team working remote except for extreme circumstances. He once admonished me for wanting to work remotely from an out-of-town B&B on a Monday before a Tuesday holiday, reasoning that I was “really on vacation” and should just take a vacation day. Things might be different now., but my theory was that with a phone and a laptop, know one knows where you are working from and it shouldn’t matter. That is proving to be true for a lot of workers.
The idea of a Corporate Headquarters has traditionally been a reflection of the huge budgets and egos of the corporate elite. Bank of America has the tallest building in Charlotte at 60 stories tall, and why wouldn’t they? Depending on the day they trade places with JPMorgan Chase as the largest bank in the US. The building is a monument to the empire of Hugh McColl and the company he created. Down the street the building that is now the Duke Energy Center started off to be the new headquarters of Wachovia. We know how that turned out.
But right now all of those buildings are mostly sitting empty. People have been told not to expect to go back to the office any time soon. So what will happen to all that office space? Good question. Companies have started to realize that space is expensive. Add to that the potential cost of refitting workspaces to meet new health rules, new cleaning requirements and the potential of workplace-illness-related litigation, suddenly all that office space starts looking pretty unattractive. And companies are realizing that shifting occupancy costs to their employees will save them some Big Money, allowing the Big Wigs to get even Bigger Bonuses.
It’s just the beginning of that cycle, I’d guess. It will be interesting to see which way and how far it goes.