The arrival of the internet in the 1990s was supposed to end office life as we knew it. Why spend two hours a day in your Buick to reach an office that was becoming superfluous? Every year, advances in the internet and all its accoutrements – e-mail, super-fast laptop computers and smartphones and, later, social media and instant messaging – surely meant that office towers would go the way of Blockbuster stores
It didn’t quite work out that way. Instead, commercial property giants such as Canada’s Brookfield and Gecina of France went gangbusters erecting steel and glass towers in the world’s biggest cities. Streets became sunless canyons, industrial wastelands such as London’s Canary Wharf became glittering financial centres. Commercial vacancies in New York, London, Sydney, Hong Kong, Paris, Toronto and Milan went to almost zero. Developers, REITS and their shareholders made fortunes.
Then came the novel coronavirus plague and office life for hundreds of millions of people vanished virtually overnight. But by 2020, working from home was dead easy. Office messaging sites such as Slack and video conferencing apps like Zoom made it so. Before the COVID-19 outbreak, Zoom had 10 million daily uses; today, the figure is 200 million and rising fast.
Which raises the question: Now that working from home is easier than ever, will everyone rush back to the office when the quarantines are lifted?
The issue is all the more pertinent when you consider that, barring a COVID-19 vaccine, some sort of effective anti-viral drugs or herd immunity, working in a crowded office could kill you. If the endless supply of office workers dries up, the developers’ build-it-and-they-will-come strategy might dry up with it. In January, Brookfield Property Partners, co-owner of Canary Wharf and dozens of other crown jewel developments around the world, traded as high as US$20 a share; on Friday, the price was US$7.75. That tells you something.
There is a theory that normal economic life – that is, going back to the office – will resume sometime later this year, when COVID-19 is vanquished. Yes, we have the technology to work from home, but we are social beasts by nature and we crave the stimulation and camaraderie of working with colleagues. Or we are simply weary of being packed into a house overflowing with unwashed laundry, irritable spouses and screaming kids. Studies on productivity while working from home show decidedly mixed results.
That theory is credible, insofar as every prediction of a mass migration from the office to the home over the decades has proved wrong. Some developers are not ruling out the possibility that more office space will be needed than ever.
Why? Because office floor plans will have to change to give employees more of their own work space to ensure adequate social distancing. The trend toward less desk or workstation real estate began about two decades ago, partly for cost reasons, and partly because employees wanted more common areas for eating lunch and grabbing a coffee. It is now inevitable that personal workspace will increase at the expense of common space. In some instances, companies may lease more floor space so their employees can spread out. The banks’ typically packed equity- and bond-trading floors in particular seem destined for the social-distancing treatment.
But all this is just a theory, largely based in the endless historic rise in office demand, calamities such as 9/11 and SARS be damned. But what if the developers are wrong this time? What if, over time, only 75 per cent of workers head back to the office?
For sure, an unknown number will resist the call of the office elevator for fear of COVID-19 transmission or their inability to get “immunity certificates” – a new safety idea making the rounds – that would allow them to resume office life (or get on an airplane or cruise ship) by proving they have developed resistance to the virus. Or maybe they simply enjoy working from home and not having to commute. Were that to happen, the business model for the big developers would need a big rethink. Tight office-space supply could turn into a surplus really fast. Goodbye construction cranes.
If working from home catches on, urban planning in general would need a strategic review. It’s a wild guess today what cities might look like in the post-coronavirus world. Would fear of new pandemics trigger a rush to the suburbs, where families can avoid crowds, or a rush to city centres, where packed commuter trains could be skipped and shopping and other outings could be done on foot?
If more people were to work from home, neighourhoods might spring back to life. Imagine a relaunch of Jane Jacobs’s urban ideal, where neighourhoods have a diverse range of work and family functions, where municipal spending goes into parks, not urban expressways, and where single-use areas, like clusters of downtown office towers, dead at night, become archaic. The home working revolution, if it becomes one, might punish the big-name office tower developers and that might not be a bad thing.
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