Translation of an article that appeared in FInance on 28th November 2011

How to reduce your office rent by 50% and improve your workspace?

Autor: Jacqueline Stuart

E-pošta: js@sloveniainvest.eu

Rents have dropped

Rents in quality office accommodation in Ljubljana have dropped by as much as 30% since the start of the global financial crisis due to a combination of new office space coming to market, downsizing and cost cutting. As I reported last month, many Companies find they can move to superior offices, for less rent, and often get a rent free period and free-fit out too.

How to save space

There is another way that Companies can save money on office space, and this is being embraced by some of the largest firms, all over the world.

By abandoning the traditional cellular office model, and adopting open plan, huge savings are being made. What is even more interesting is that by fostering new ways of thinking about how office space is used, architects and planners are creating spaces that employees love to work in, and are proud of.

A new research report from Colliers International, a global real estate consultancy, predicts that Europe will see a 20% drop in demand for office space over the next few decades.

Shifting demographics

The baby boomers dominate the current workforce, comprising almost 45%. This group has influenced the planning of office environments in recent years, resulting in a high proportion of cellular offices as opposed to open plan. However by 2020, the boomers will have less influence as half of them will have retired. Generations Y and Z will then dominate, and have a much greater say in decisions regarding the workplace.

The workplace has to work harder

Metod Vidic, Director of Ovita, is the local representative of global company Steelcase, which provides innovative office furniture and solutions for workspaces. He comments, ‘the workplace has never had to work so hard. It has to maximize the use of real estate, attract and engage workers, communicate company brand and culture, and foster collaboration and innovation’.

Collaboration is the fuel for innovation, and space saved by creating smaller individual workspaces can be used for spaces everyone will use: impromptu meeting areas, project rooms, and huddle rooms. These support learning, socializing and collaborating.

Unassigned workspaces

Many Companies are embracing unassigned workspaces; three examples of these are ‘hot-desking’, ‘hoteling’ and ‘benching’. Hot-desking means a worker takes the first free desk available, which might well change on a daily basis. Hoteling is similar, but workers have to reserve their desk in advance through a concierge system. Benching is like hot-desking, but the workspaces are not confined to desks, workers share a parallel work surface along a spine, with no space-defining panels and little or no dedicated storage and privacy. Each worker takes what space is necessary for the job in hand that day. Steelcase conducted research that shows space savings of 22-26% for benching compared to individual workstations. Real estate savings due to benching can be utilized for the benefit of all workers – for cafes, lounge areas, team rooms and other shared spaces.

Accenture’s Workplace 2

Accenture, a global consultancy, recently piloted their ‘Workplace 2.0’ strategy in a new Houston office. The results are impressive. Their office went from three floors on over 6,000m2 to 2,300m2 on one floor, whilst still housing more than 800 people. Like many Companies, Accenture found that many workstations were empty for long periods of time because workers were collaborating in team spaces, project rooms, or offsite. Accenture changed to benching for workers who need different spaces during their time at work. They move seamlessly from bench, to enclosed space, to café, to lounge area. Their work weaves between meetings, informal collaborations, quick asides, and focused personal work sessions. The Accenture workforce voted the new offices an outstanding success, in a study that measured Interaction with Clients and Customers, Networking and mentoring, Impromptu collaboration, and Collaboration with team members. The overall improvement was 26%.

Vodaphone in Holland

Vodaphone, a mobile telecom leader, applied a similar strategy for their new Dutch headquarters in Amsterdam. The Company was consolidating three different sites into one in the new premises. Vodaphone’s new workplace has a very open layout with no assigned workspaces, combined with a wide variety of meeting and project spaces. Every Vodaphone staffer, from leadership to the newest worker, operates from the same workspaces. Like Accenture’s office, Vodaphone’s workplace is colourful, welcoming and energetic. Vodaphone reports more informal communication, which adds to productivity.

Of course some private offices still exist in Accenture, Vodaphone and other Companies adopting unassigned workspace planning. In the past, organizations often allocated private offices based on hierarchy. Now many of those decisions are made on the basis of job function and worker needs. In some companies, employees are assigned private offices that are made available to others when that person is away. The private office worker isolates confidential materials in a file, and that office can become a meeting room or huddle space.

Making office space work in Ljubljana

It is quite clear how the future of office space will develop in Ljubljana. Many Companies will take advantage of lower rents and landlord’s incentives to move to new and better office space. Some of those will rethink the way they work, and introduce unassigned workstations, which will allow them to reduce the overall space they occupy, whilst improving the workplace experience by introducing more collaborative spaces such as coffee points, chill out areas and huddle spaces.

Our Company will be moving in the New Year from the World Trade Center to offices in the city center. We will adopt an unassigned benching system, with a cafeteria and chill out area, and a more private heads down zone for when uninterrupted concentration is required. Clients will meet with us in the cafeteria area, or the heads down zone, depending upon availability. We expect to reduce our space by 30%, accommodate 2 more workers, and improve interaction and collaboration. I look forward to reporting on how well we succeed in a future article.

Jacqueline Stuart is a Director of S-Invest d.o.o.