“No question: “The” office remains an integral part of the modern working world, even after the Corona pandemic and the experience of “remote working”. But the balance between the old working world and the new, more flexible conditions has not yet been found. Statements from corporates to traditional SMEs do not create a clear picture. At the very least, it seems clear that the classic 100% presence – especially in service professions – will no longer exist.
Whether it’s always “Friday” or the €49 ticket as compensation, becomes clear from our survey below. The real estate industry currently still has problems quantifying these market developments. In the following survey of 250 real estate investors in the DACH region (response rate 31%), these and other neuralgic points of the current discussion are underpinned with a numerical framework.
Here are some results:
Concept change ahead?
- 82 % of the market players we surveyed said they were aiming for a combined use of home office and office building in the future.
- Only 2% of respondents still said they would only use the home office in the future. These data make it clear, despite the hype years during the pandemic, that the office building is not a concept of the past.
- 63 % of the interviewed stakeholders stated that generous space design to promote personal exchange is gaining in importance.
- 41 % expect the central location of an office property to become increasingly important in the future.
- 61% of the people we surveyed said that good public transport connections to the office building are becoming more important.
Communication requirement decides on presence in the office
- 70 % of the respondents expect that the personal direct exchange will positively promote communication within the company.
- In our survey, 49% of respondents said that increased visits to the office building can improve the company culture.
- 39 % of the people we interviewed shared that a frequent perception of the workplaces in the office building has a positive influence on the staff’s identification with the company.
- 73 % of the respondents stated that they had already experienced that mobile working or home office is an important criterion in the application process.
Current market figures as well as the results of our survey imply that the office property market has to adapt to new requirements. The requirements for the location of the office building are also influenced by current market developments. Above all, office space in central locations in large metropolises is the focus of demand. We expect that office space in central locations in large metropolises with a design that meets the new requirements of the market will continue to be in high demand on the office property market in the future.
With a view to older office properties in decentralised locations or in smaller office markets, however, it is likely that the position in the market will deteriorate significantly for a large number of these office properties – including a further tightening of ESG requirements for these properties. In quantitative terms, we expect a significant increase in vacancy rates for the property/location combination. In the top segment of the office property markets in large metropolitan areas, however, a rise in vacancy rates is unlikely due to the continued high demand for office space and the need for “green properties”. Furthermore, positive growth in prime rents can be expected in this segment of the office property market in the coming years.”
By Prof. Dr. Thomas Beyerle, Catella Real Estate AG