Flexible work can deliver both better employee engagement and real estate savings. Here’s how tenants and investors can prepare.
Since the Covid-19 pandemic hit, many companies have implemented flexible work patterns in pursuit of better employee experience, real estate cost savings, and more sustainable operations. However, a McKinsey survey of real estate and employee experience executives from 50 companies reveals that most firms have only scratched the surface.
The survey asked how far along companies are in implementing 12 practices McKinsey has identified as key to developing effective and sustainable hybrid work strategies (for a description of the survey, see sidebar, “Our methodology”). Their responses suggest that many companies are targeting useful data and technologies and thinking strategically about on-site and remote work, but most are still struggling to strike the right balance in creating “true hybrid” work models. Even some of the most forward-thinking companies are leaving both performance improvements and more efficient real estate spending on the table.
In this article, we take a closer look at the findings and identify what companies are doing well and where they can improve. We also shed light on how various stakeholders can use the survey’s insights to inform their next steps. Based on our experience, companies that learn how employees are using workspaces and understand what changes are necessary to meet employees’ needs can allocate capital more efficiently and design more effective workplaces.
Developers and operators also have an opportunity to support tenants as they transform their workforces and workplace experiences. Real estate owners and investors can attract leading-edge occupiers by understanding the industry’s new imperatives and offering services and business solutions in addition to physical spaces.