By 2040, the British city centre office will offer a personalised space totally focused on the wants and needs of the occupier. This means shorter and more flexible leases, a focus on wellness and greater use of efficiency enabling technology – forces of change which are already in evidence in our 2018 CBRE EMEA Occupier Survey.
Smart office buildings will be the norm by 2040. Early examples of smart offices, such as The Edge in Amsterdam have proven extremely successful. Quite apart from its BREEAM rating of 98.4%, innovations such as automatic desk booking systems, dynamic personalised lighting and environmental control systems and sensors on locker space have proven financial and productivity benefits to the tenant, Deloitte, including a 60% drop in absenteeism, increased applicants for open positions and strong brand positioning around their Digital Innovation credentials. Reflecting the rise of the ‘Internet of Things’, the office building of 2040 will be connected to thousands of sensors monitoring energy use and supporting predictive maintenance tests on plant and machinery.
We expect that the continued development of technology enabled occupancy tracking tools, inter-connected with room booking systems, will have a significant impact on the allocation of resources and space. Real time data insights will reduce wasted space and will critically inform occupiers’ decisions on the balance to strike between core dedicated spaces and more variable flexible third party solutions (including serviced offices and co-working solutions). More buildings will be fully ‘smart’, with integrated and connected systems, as opposed to smart in one or two aspects.
Smart buildings are one way in which occupiers’ growing need for agility will be satisfied. But there are others. For example, flexible office space will be far more prevalent in the market in 2040 than it is today. We estimate that around 8% of all office stock in Central London is flexible office space currently. This has the capacity to rise to as much as 20% by 2040. Based on current stock numbers, this would equate to 45m sq ft. The office building of 2040 will likely incorporate flexible space along the lines shown in Figure 1.
Figure 1: Indicative allocation of office space in buildings of the future
The increase in flexible office penetration will cause a dramatic shift in the typical lease term of office space. Currently, the market standard for institutional leases on office property is 10 years. By 2040 this figure will be closer to five years. Whilst a decline of this magnitude seems severe, it is not without precedent.
Wellness initiatives will be central to the design of office buildings in 2040. Mental health has been moving up the agenda in recent years and is becoming a big issue for office design. For example, a survey by the charity Mind suggests that 21% of office workers have called in sick in the past because of stress in the office.
So, by 2040, expect the office to feel more personalised, informal, adaptable and responsive than it is now. But don’t expect the office as a use to become redundant. As long as there is work, and as long as humans are social creatures and need to collaborate in person, there will be places we gather to work, rest and play. It’s open for debate whether they’ll still be called offices.
However, whilst we expect the office buildings of the future to be smart, we do not expect those inside to be dressed smartly. With just one in ten workers currently turning up to the office in a suit, it is probable that by 2040 the office buildings will be a lot smarter than the office workers.