COVID-19 outbreak is expected to have a brutal short-term effect on Danish economy, while mid-term outlook remains optimistic. Governmental fiscal stimulus will be essential to ensure the economy can bounce back quickly. Although Denmark has become one of the first countries in Europe to begin lifting some lockdown measures, the reopening of the economy will be gradual.
Office-based employment in major Danish cities, a key driver of office demand, will see slower growth. As governmental restrictions permit the return to work and businesses are broadly allowed to reopen workplaces, occupiers are preparing to determine their own thresholds and policies for welcoming employees, customers and visitors back to their offices and places of business. Many large office occupiers are starting to think about what “return to work” might look like.
Therefore, we believe that many occupiers are already or soon will be in the process of reconsidering their real estate strategies. The allocation of space will now be evaluated through the lens of redefining what the maximum occupancy should be, potentially resulting in a move away from large centralised offices for business-critical operations with organisations instead choosing a greater number of smaller operations in different locations.