by Marc Shamma’a, Head of Strategic Consulting
It used to be that an employee was required to show up at his or her physical office from nine-to-five, five days a week (pending any kind of vacation or illness). Specific times were set, with remote work or flexible hours accepted only in rare cases – and only by rare bosses. By and large, the idea of working off-site was considered ludicrous; it was believed that employees had to be physically present to complete job tasks.
These days, technology and increasing operating costs are softening the corporate mindset when it comes to remote work. Co-working and free addressing are, in many cases, replacing the nine-to-five, five-days-a-week mindset of many companies.
In fact, in an effort to reduce their real estate footprints, many companies actively encourage their employees to work remotely and come into the office only a couple of days a week. And when those employees do show up at the office, they might find a lack of assigned workspaces. Instead, they’ll find empty desks where they can plug in their devices – laptops, tablets and smart phones – and get to work.
This concept is known as free addressing (or hot-desking, in some locations), in that the employees take the space on a temporary basis, and don’t have permanent space. Permanent space off-site, generally at a home office.
Then there is co-working space, which provides a work space, Wi-Fi and outlets for those who might not have a permanent workspace in a particular location. Freelancers and the self-employed typically make use of co-work spaces. Co-working also provides a viable alternative for companies requiring short-term space without the long-term lease.
Though they serve somewhat different functions, co-working and free addressing can work together to benefit organizations of all sizes. Take a 15-story building, in which the top five floors are occupied by an international corporation. Perhaps the bottom floors are taken by small- and medium-sized companies. The middle five floors are run by a co-working business, and that business can provide all sorts of benefits to the more permanent companies in the building.
The smaller businesses can use the co-working space to expand, eliminating the need for long-term leases. And, if the need for space goes away, the smaller businesses can leave the co-working space. Without having to worry about subletting or paying off a lease. The co-working space gives the smaller businesses time and space to work out expansion decisions and strategies.
Meanwhile, the multinational company on the top floors no longer has assigned workstations (except for employees who must be onsite). The MNC is also embracing free addressing. Its workforce, for the most part, operates remotely and comes in only for meetings. But a sudden, short-term project requires more employees to be onsite. The co-working business can provide space and desks for those employees, at least, until the project is complete. Additionally, when foreign employees travel to the multinational for visits, they can be set up in the co-working space.
This scenario, though theory, is not so far off. Corporations continue shrinking their real estate footprint to save costs, and are turning to free addressing. Smaller businesses find co-working space, with its monthly payments, less restricting than a long-term lease.
Co-working and free addressing are trends that office brokers and facility managers need to watch. As organizations continuously change the way in which they operate, their space needs change as well. The way things are going now, those requirements seem headed to smaller footprints, remote activities, and space on demand.
Marc Shamma’a is the head of Strategic Consulting for the APAC division of Cushman & Wakefield.