Just nine percent of companies surveyed by CBRE plan to significantly shrink their office portfolios, a figure that’s far less than last year’s 39%.
Of the 185 companies surveyed by the CRE giant in its Spring 2021 Occupier Survey a whopping 85% say they expect employees to spend at least half of their time in a physical office. The majority of large companies—72%—appear to be planning for what CBRE calls “modest” office-space reductions, a significant increase from CBRE’s September 2020 survey results (45%). And smaller companies report they’re more likely to keep their portfolio the same or grow it.
“Multiple factors support this sentiment, including the ongoing rebound of the US economy and companies’ realization that they need to retain more office space than they previously thought,” said Julie Whelan, CBRE Global head of Occupier Research in prepared remarks. “Many companies now recasting the design and function of their offices will find that the square footage needed to accommodate team-centric work, free-address seating and meeting space often exceeds that previously dedicated to rows of individual offices and cubicles.”
But remote work isn’t going away: 38% of companies CBRE surveyed say they think workers will spend three or more days in the office, while 32% anticipate an equal mix of in-office and remote work. About 15% say employees will only work in the office, and 7% say employees will do “most if not all of their work remotely.” CBRE’s Econometric Advisors data science and forecasting unit also predicts companies will use 9% less office space per worker. However, “the impact on office demand will be largely offset in the coming years by increased hiring amid the economic recovery and evolving office floorplans that provide more room between workstations and ample space for group-centered work,” the report states.
CBRE predicts the US office market will begin its recovery in mid-2022 and that asking rents will return to precrisis levels in early 2025—a quicker recovery than the Great Recession.