Salt Lake City, UT—March 31, 2017 – While
talent continues to reign supreme on the list of top concerns for companies
today, a new survey of
corporate executives underscores the challenges they are facing in today’s economic
environment. Of the 176 Americas executives surveyed by CBRE Group, Inc., 52 percent named economic
uncertainty as a top-three concern, up from 36 percent in 2016.
As a result, 87 percent of corporate occupiers
report that they are managing this uncertainty by disposing of surplus space and/or implementing more efficient workplace
designs to prepare their portfolios for the future. Further, only 26 percent of
respondents expect to expand their portfolios over the next two years, down
from 38 percent in the 2016 survey. Approximately one-half of the 2017 survey’s
respondents indicated that the size of their portfolios would remain stable
with 2016 levels.
Other key priorities for occupiers in 2017 include:
While uncertainty is driving many real estate decisions, creating a
workplace experience focused on talent remains top of mind for the majority of
occupiers surveyed. Sixty-seven percent of respondents cited employee
satisfaction as the key measure of the success of their workplace strategy
programs. This is a higher percentage cited than occupancy cost per sq. ft. (56
percent), occupancy cost per employee (53 percent) and target cost reduction (42
percent). Further, 55 percent of respondents said talent attraction or
retention was among the top three drivers of their organizations’ workplace
strategy, and 53 percent said promoting collaboration was the most important driver.
Only 40 percent cited operating expense savings as among the top three drivers.
“Mobile and cloud technology has made it efficient to work from
anywhere, so the office is becoming an optional place,” said Julie Whelan,
Americas head of occupier research, CBRE. “Employees must be drawn to the
workplace through a positive emotional connection. In turn, employers benefit
from a collaborative and cohesive culture because both formal and informal
communication are more powerful when face-to-face.”
To motivate employees to come to the office, occupiers are turning to a
range of amenities and services that support the integration of the workplace
into both their personal and professional lives. Sixty-four percent of
respondents said amenities are most important to their labor forces, with food
offerings being the most prevalent (81 percent) and hospitality services on the
cutting edge (32 percent).
Employers are also increasingly placing importance on developing a
workplace culture that enhances employees’ health, with 76 percent of survey
respondents reporting running an employee wellness program.
Elevating the Corporate Real Estate Function
The management and operation of corporate real
estate departments is continuing to centralize and rise in importance within
corporations. While there is clear recognition of real estate’s impact on employees,
the prevalent organizational structure remains cost-centered, with 66 percent
of respondents reporting to finance, operations or procurement departments.
“Today’s top companies are shifting the traditional
view of the physical space from a mandatory cost toward a customizable, revenue-enhancing
tool,” said Matthew Toner, managing director, Global Workplace Solutions, CBRE.
“Business leaders clearly accept that a well-designed and managed office can enhance
their employees’ collaboration, engagement, health and productivity. However, empirically
demonstrating CRE management decisions to drive improved metrics in these areas
remains the holy grail.”
“Regardless, there’s no question CRE tech has
entered the mainstream,” Mr. Toner added. “The new breed of technology provides
previously unfathomed abilities to efficiently monitor buildings, optimize
space utilization and engage employees.”
CBRE Group, Inc.
CBRE Group, Inc.
(NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles,
is the world’s largest commercial real estate services and investment firm
(based on 2016 revenue). The company has more than 75,000 employees
(excluding affiliates), and serves real estate investors and occupiers through
approximately 450 offices (excluding affiliates) worldwide. CBRE offers a
broad range of integrated services, including facilities, transaction and
project management; property management; investment management; appraisal and
valuation; property leasing; strategic consulting; property sales; mortgage
services and development services. Please visit our website at www.cbre.com.