Demand for office space to rise by 2019

Professional services companies in London will need an additional 5.1 million square feet of office space by 2019, according to a report by real estate group CBRE. 

Heightened demand for office space will mean firms will have to adopt pragmatic workplace strategies to fulfill business objectives as 92 per cent of respondents to CBRE’s Professional London survey suggest they use workspace strategy to enhance employee satisfaction, and 83 per cent of firms use it as a means to control costs.

Companies are placing greater emphasis on the ‘wellness’ of employees against a backdrop of space intensification. 

Factors such as technology, and the design and aesthetics of the building and workplace are gaining increasing importance alongside on-site amenities, connectivity and location and lifestyle offerings to aid employee satisfaction, says the research. 

Accountancy and management consultants currently allocate 1.25 people per desk as part of their flexible working arrangements; this is forecast to rise to between 1.5 and 1.75 in the next five years with agile working (including remote working) becoming commonplace.

Increasingly firms require collaborative space to support agile working, with a greater proportion of a company’s space assigned to breakout areas and touchdown space, according to the report. 

In addition firms will consider the use of small satellite touchdown offices in key locations for internal and client meetings. For firms following this option, it will be accompanied by a re-location to a lower cost location providing a similar level of amenities. This strategy will go hand in hand with outsourcing – where the recent focus has been around near shoring in key UK regional cities. 

Robin Wickham, executive director in the central London division of CBRE, said: “The report highlights the very real tension between rising property costs, competition amongst firms to attract and retain the best talent, and employee satisfaction. Occupiers are under pressure to keep costs down and are continually exploring strategies to use space more efficiently.”

Wickham added: “As well as attracting talent, evidence suggests that adoption of ‘wellness’ standards have a positive impact on employee productivity and business performance with 83% of respondents citing workspace strategy as a means of promoting employee effectiveness. 

“However, offices will need to be used more efficiently whilst the allocation of desks per person is expected to decrease - increasingly the professional services sector is adopting hot-desking strategies to encourage collaborative working practices and space saving.”