Advancements in technology are changing how executives think about their businesses, and those impacts are starting to show up in real estate decisions. Watching these changes, according to Bret Swango, CFA, senior vice president, Workforce Analytics & Location Strategy at Colliers, is important for anticipating and appropriately positioning our clients for future industry movement.
"I'm always focused on what matters most to CEOs and capital allocators, and how those priorities are evolving," says Swango. "Over the next 12 to 24 months, those shifts ultimately translate into real estate decisions."
He notes the dominant concern among executives today is the unprecedented pace of change, specifically with technology and AI, geopolitical uncertainty and access to talent. As AI climbs the list of priorities, Swango is watching trends around where office demand is heading and what new variables are entering the equation.
CEO Sentiment Around AI Is Shifting Fast
Executive expectations around AI investment returns are shifting rapidly. "The critical question has been: with all this investment in AI, when will organizations begin seeing measurable returns?" says Swango.
Swango highlights research showing that in December 2024, only 20% of CEOs expected to see returns on their AI investments within one to three years. Just one year later, that figure surged to nearly 90%. "That dramatic shift raises a broader strategic question: What does accelerating AI adoption mean for people, workplace strategy and future real estate decisions?" says Swango. For Swango, the answer lies in understanding how AI changes where talent is located, how teams collaborate and the infrastructure organizations require to operate.
He explains that he was recently working on a large headquarters requirement involving more than 1,000 employees. "Leadership teams are increasingly reevaluating traditional assumptions around headquarters strategy," says Swango. "The question was no longer whether technical talent needed to be co-located with traditional finance and operations personnel. Technical capabilities are now becoming a core requirement across the organization, fundamentally changing how companies think about talent, location strategy and headquarters planning. It is less about where the absolute leading-edge talent resides and more about which markets have experienced the greatest diffusion of AI, meaning where traditional white-collar roles are adopting the technology most rapidly. As technology demands evolve, so too do workplace requirements and the types of real estate that best support them."
A New Variable Arises in Location Conversations
As organizations reassess location strategy, power availability is emerging as a critical new factor. "It's the new scarce element in the value equation for much of the work I'm doing right now," says Swango. "Companies are now asking where they can find grid-connected capacity within extremely narrow time frames."
As AI workloads become more compute-intensive and organizations invest in new technologies, access to reliable power is becoming an increasingly important consideration in location and occupancy decisions.
He connects this shift to a growing interest among occupiers in moving certain workloads back on-premises for security and latency reasons. However, with all these changes and the pace at which they're occurring, Swango notes that people still play an important role in how quickly changes unfold.
"Organizations only evolve as fast as their people do," says Swango. "In today's environment, the speed at which organizations can adapt will ultimately define their long-term competitiveness, or to quote Jack Welch, 'if the world outside your company is changing faster than the world inside your company, the end is near."
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