Investors are starting to discover that even the most beautiful office buildouts can fall flat if employees do not feel they have any real control over the space. Research highlighted by University of Virginia professor and design expert Leidy Klotz suggests that the real value in office assets may come less from finished layouts and more from how easily workers can adjust and "own" their surroundings.
Klotz, who studies design and problem-solving, recently argued in the Wall Street Journal that companies focused solely on layout, lighting and amenities may be missing the real driver of performance. He writes that the key factor is employee control—what he calls "agency"—over the workspace, and that this has direct implications for engagement, retention and productivity.
For investors and owners, that points to a shift from delivering a polished but fixed product to enabling a flexible, user-driven space that tenants can adapt over time.
Why Design Alone Falls Short
For years, many office developers, landlords and occupiers have poured money into new layouts, upgraded lighting, sleek finishes, fitness centers and food options in hopes of luring workers back and keeping them in the building longer. Klotz argues that this strategy, while understandable, misses the point if workers still feel like they are just occupying someone else's idea of how they should work.
"The real driver of productivity isn't the layout," he wrote. "It is how much control—or agency—people have over their own space." He notes that decades of research back this up: more agency translates into higher well-being and better company performance, while less agency means weaker engagement, lower retention and eroded trust.
From an investor's standpoint, that means a highly designed space that employees rarely use as intended may underperform a more modest layout that people feel empowered to shape.
Klotz frames the issue in simple human terms: agency is tied to self-respect. When workers can make choices about how they use a space, they are more likely to feel valued and less like replaceable parts in a machine. That emotional shift can influence how often they come to the office, how long they stay, and how productive they are when they are there—all factors that ultimately affect tenant demand and building performance.
Turning Offices Into Tools Employees Control
Klotz suggests thinking of office spaces as tools rather than finished products. For those tools to be effective, employees have to understand what they are allowed to do with them. He likens low-agency workplaces to being turned loose in a workshop where you do not know what the tools do, whether you're permitted to use them, or how they work. In that scenario, most people retreat rather than experiment.
The same thing happens with space. If a new hire does not know whether the conference room at the end of the hall is available to everyone or quietly reserved for executives, the safest move is to avoid it. The room then sits empty, and the employee's sense of helplessness deepens. Clear cues—glass walls that show the space in use by different teams, an open door, visible booking practices—signal that the room is meant to be used, not feared.
Movable elements reinforce that message. Klotz notes that chairs or whiteboards on wheels invite people to reconfigure their environment, which in turn normalizes the idea that they have permission to adapt the space. By contrast, a room full of fixed furniture conveys that the layout is "set" and not to be disturbed. For investors and owners, designing in this kind of flexibility can make a space more resilient and useful across different tenants and work styles.
Klotz also points out that an impersonalized space feels unwelcoming in the same way an unfurnished apartment does. Until people set it up to reflect their needs and preferences, it does not quite feel like theirs. Simple controls matter here. He suggests that employees should be able to adjust lighting and temperature in their immediate surroundings, so they are not working all day under conditions that feel imposed. Those details may sound minor, but they are the kinds of features tenants increasingly look for when comparing buildings and deciding whether an office supports their culture.
What This Means For Investors And Landlords
Klotz's recommendations extend beyond small tweaks. He argues that companies should involve employees when planning major renovations, rather than unveiling a fully baked design that nobody outside leadership helped shape. Employees should be able to choose office locations that best support what they are trying to accomplish—whether that is heads-down focus, quiet collaboration, or casual conversation.
When executives or managers reorganize a space, they should explain why and show how the changes align with broader company goals, so workers see the rearrangements as tools for better performance rather than arbitrary disruptions.
For investors and building owners, there is an additional layer: most offices are leased. Significant changes to layout or systems often require negotiation and agreement between the tenant and the landlord. That means an employer's ability to give its people more control over space is, in part, constrained or enabled by the lease structure and the building's flexibility.
This is where the idea of shifting from finished layouts to flexible, user-driven space becomes financially relevant. Assets designed and managed to accommodate reconfiguration—movable walls, easily reprogrammable systems, clear policies on alterations—position tenants to offer their employees greater agency without constant friction with ownership. Clear, up-front communication between landlord and tenant about what can be changed, under what conditions and at what cost is usually easier than trying to resolve conflicts after the fact.
For commercial real estate investors, the core takeaway from Klotz's research is that "better design" is no longer just about visual appeal or amenity checklists. It is about how well a building enables tenants to hand meaningful control to their employees—control over where they work within the office, how they configure their immediate surroundings, and how space evolves as needs change. In a market where tenants are scrutinizing every square foot, offices that support this kind of employee agency may stand out not because they look perfect on day one, but because they can keep working for people on day one thousand.
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