Return to Office

Robbins says his team coined the phrase “what’s your return on commute?”—a worthy question in a congested city like Atlanta. While there are not Cisco-wide mandates for employees to be in office, individual teams set guidelines for days teams are expected to work onsite together, Robbins says. “Seventy-plus percent of our first-line managers have at least one remote employee already,” he says. “It’s not as black and white or as cut and dry” as other companies. “We’re trying to be a little more flexible.”

Midsize and regional banks like Signature and First Republic not only provide the bulk of commercial real estate loans to businesses, they are also part of a far bigger market. Banks typically package the loans they make into complex financial products and sell them to investors, allowing the banks to raise more money to make new loans. For much of last year, commercial real estate lending had begun rebounding from the depths of the Covid-19 lockdowns, when new loan applications almost came to a standstill in the fourth quarter of 2020. By comparison, the annual rate of commercial real estate loan origination by dollar volume grew 18 percent in the fourth quarter of 2022, according to Trepp.

One interesting development with the remote work movement is the impact on corporate office space in large cities and municipalities and the tax breaks they get to occupy high traffic space. With less traffic and reduced revenue from commuters, it will be interesting how these local governments tackle tax breaks for employers whose spaces are not occupied. Another initiative created in New Jersey during the pandemic, the Emerge Program, hints at what future incentives might look: Rather than commit to a certain percentage of time spent in office, applicants have to prove that 80% of eligible employees’ work time is spent in the state — and that they have enough space to accommodate at least half of their workforce on site, “without packing people in like a sardine can,” Sullivan said. 

If you type "Janitor shortage" into Google, you'll come away with many articles about school districts and building service contractors struggling to find and retain custodial and janitorial staff. This is a striking example of what some facilities leaders at schools and workplaces are struggling with every day to get work done to ensure a safe, healthy and productive environment for occupants. The unusual work-study program launched at Blaine High School last week, The Star Tribune first reported. Students must be at least 16 years old and are paid $15.30 an hour, according to a job application posted by the district.  Record numbers of Americans have been quitting their jobs in search of better working conditions and the greater cleaning industry is no exception. Residential cleaning companies told Insider they're having to turn down business and reschedule or even cancel regular customers because they can't find enough staff.

Employers are not only battling inflation and slowing growth, but worker productivity that is falling at the fastest rate in four decades. This has been the first year since 1983 to include three straight quarters of year-over-year drops in average productivity per worker, ADP chief economist Nela Richardson said during CNBC’s recent Workforce Executive Council Town Hall.

Kastle’s 10-city occupancy average, based on its survey of entry card swipes, stalled at 43% in March—a level it hovered around for the next six months—and then registered a modest bump to around 47% in the weeks since Labor Day.

CoreNet Global shared some survey data on the impact inflation is having on CRE real estate portfolios and footprints. We are seeing trends of shorter lease terms and more caution with longer commitments which makes sense in a time of potential instability in the markets. Here are a few key stats: More than half, 54 percent, are consolidating locations and 42 percent are reducing the size of leases they are signing 34 percent say that annual escalations are 100 basis points higher than normal 44 percent say that compared to prior to the pandemic their overall corporate real estate footprint has decreased; 21 percent say that it has increased, and 34 percent say that it has stayed the same. Between now and 2025, 39 percent expect an increase in the size of their corporate real estate portfolio, 42 percent expect a decrease, and 19 percent say that it will stay the same.

This month's newsletter will include two recent surveys on return to work and cleaning, NYC CRE market trends, hybrid work's impact on real estate portfolios and the return to office plans for Apple, Peloton, Bank of Canada and others.We hope this content is helpful as you navigate your return to …

Employees are asking for a flexible work experience new things and facilities teams must adapt to that sentiment, with new views around health, safety, and work-life balance. Hybrid workplaces not only mean flexibility for the employee but also more variability and complexity for facilities teams trying to provide a best-in-class physical workplace. How can we create the best and most efficient office environment to ensure satisfaction amongst occupants?

This month's articles will look at the key data points from recent studies around the future of the office, hybrid work, and sustainable workplaces.