As the world becomes even more interconnected and porous, today’s office space will need to be highly flexible to adjust to the changing global economy. Commercial owners and occupiers can mitigate economic uncertainties by implementing real estate strategies that are aligned with their business plans. Having such strategies are aimed at providing a combination of both cost savings and flexibility that will allow owners and occupiers to adapt to changes in market conditions. Applying these strategies will provide some relief to balance sheets and opportunity for earnings to income statements. Anticipating future office needs is important as it lays the foundation for the real estate function to be better equipped to respond to changes.
When planning an office space, you will need to take into consideration that it should be able to accommodate the evolving needs of your business. Having an office space that is flexible will allow your company to either expand or contract at a moment’s notice. It should support and not frustrate your employees. Some of the tell tale signs of bad office planning include disorganised desk placements and messy surroundings. This will indirectly have an impact on employee’s productivity and morale.
So how can good office space planning be achieved? Firstly, pay important consideration to your reception area as this is where the public forms their first impression of your company. A good reception should be reasonably large, well-lit and comfortable, with sufficient chairs and a good colour scheme. It should also have access to the washrooms and perhaps a coffee machine. Welcoming reception staff is also essential.
Secondly, you need to identify the types of business you are in and if your employees will be a highly mobile or deskbound workforce or a mix of both. Doing this will allow for an economical use of office space. Allowing staff to work from home is especially suited for the Generation-Ys who are comfortable working with their blackberries and laptops. This measure can cut rental cost and potentially increase productivity but has yet to be significantly picked up in Singapore. Perhaps, a more practical workplace strategy is “desk-sharing”, especially for staff that are always on the move, like those in insurance companies and real estate agencies.
Desk-sharing will allow non-essential staff to share office desks with others when they come into your office. Hot-desking space need not necessarily be equipped with chairs. Just standing tables will suffice as these staff will only come to your office as and when needed for a short duration. Should the economy do well and you need to hire more staff, you can expand your administrative staff’s office space to encroach into the hot desking space. This will in turn encourage a high turnover rate of hot deskers so that others can utilise the space.
Thirdly, you can apply a “sale-leasebacks” strategy during an economic downturn, which can release precious capital to a balance sheet that is tied up in corporate assets, such as property. In the instance where a company occupies less than the entire premises it owns, then the sale and then leaseback of only the portion it wants to use, will lower overall rental cost without the need to move offices. The great advantage of using this as your planning strategy is that it can be implemented quickly and can be structured in such a way that it remains flexible to future office needs, such as expansion.
Another strategy that can be adopted by occupiers in Singapore is by moving non-client facing staff out of the CBD. Banks like Standard Chartered and Citigroup have implemented this strategy. In the case of both banks, they have a front office in the CBD while their back office support functions, such as IT, are located in Changi. This relocation measure can result in up to 50 percent cost savings.