Original Article Published in The Globe and Mail: Immen, Wallace. “Flex office spaces become a respite from working at home, commuting long distances” The Globe and Mail, January 22, 2022
Even before the pandemic, Hungerhub.com never required its employees to come to the office. In fact, one employee works full-time from Brazil, and another is currently working virtually from Barcelona.
“The policy is, you can work from anywhere; it doesn’t matter, as long as you’re being productive,” says Sari Abdo, Hungerhub’s chief executive officer. The corporate catering company’s business more than tripled in 2021 and expanded into Vancouver and Calgary as its work force has grown to 30, most of them hired during the pandemic.
For those who prefer not to work from home, the company provides the option to lease a desk in a co-working space convenient to where they live.
Social capital has diminished and health and productivity spikes we saw early in the pandemic have dwindled with isolation.
— Caitlin Turner, Senior Principal and Director of Design Interiors, HOK Canada
“Many of the staff live in condos and don’t want to work from their kitchen counter while their partner may be working at home as well,” Mr. Abdo explains. The company provides a stipend averaging $350 a month to cover the rental of a co-working space.
It’s a much more effective remote work option than the coffee shops Mr. Abdo used when he started the company in 2017.
“There are too many distractions and background noise and there might not be enough WiFi speed. Co-working spaces are designed for focus on work and there are good WiFi and outlets everywhere,” he says.
Many companies are experimenting with remote working as the disruptions of the pandemic reach the two-year milestone, says Scott Watson, managing partner of acquisitions and leasing at Crown Realty Partners in Toronto. Nine of Crown’s 34 office buildings in Toronto and Ottawa include co-working office centres.
While there wasn’t any growth in co-working early in the pandemic, Crown is now seeing increased interest in suburban touchdown spaces where employees can work remotely and avoid commutes to a downtown head office.
“Much like the open-office work plan, co-working and remote offices can make sense for some companies but not for all.”
— Scott Watson, Managing Partner, Crown Realty Partners
Increasing numbers of employers are investigating the co-working model because hybrid work is here to stay, says Wayne Berger, CEO, the Americas for IWG PLC, whose international portfolio of shared workspace brands include Regus, HQ and Spaces.
IWG is preparing for exponential growth and will expand its Canadian footprint with five new Spaces locations in early 2022, for a total of 173,500 square feet of new flexible workspace in Toronto, Ottawa, Dartmouth, Vancouver and Surrey, B.C.
Startups and tech companies were the typical clients for hybrid and flexible workspace before the pandemic, but now it’s trending far beyond that to financial companies, banks, insurance and pharmaceutical companies and government, Mr. Berger says.
An Angus Reid survey commissioned by IWG found once stay-at-home restrictions are lifted, 27 per cent of employees would like to work in an office close to home, and another 39 per cent favoured a hybrid mix of working from home or a local office and occasionally a corporate central office. If required to work in the office five days a week, 29 per cent said they would look for another job.
The concept of a central urban office and branch operations in the suburbs had fallen out of favour in recent years as many companies consolidated their real estate holdings, says Caitlin Turner, senior principal and director of interiors for design and architecture firm HOK Canada.
“The pandemic and the prospect of an era of hybrid work is focusing clients, as well as our company, to shift away from the mindset of one central office and one desk per employee,” she says.
At the start of the pandemic, working from home seemed like a solution, and productivity appeared to be high, “but two years later, we can see that social capital has diminished and health and productivity spikes we saw early in the pandemic have dwindled with isolation and not being inspired by colleagues. People are saying we need to go back to workplaces,” Ms. Turner says.
HOK is developing prototype designs for satellite offices in both suburban and downtown locations that typically include an arrival zone, storage for day use, casual lounge space, food vending, spaces for team meetings and outdoor space.
Anticipating a hybrid work schedule, one pharmaceutical organization built a work space within their hub, Ms. Turner says. “They essentially created a co-working environment with meeting rooms and work stations for people coming in one or two days a week to work in the space.”
The remote office trend is an international phenomenon. A global survey by commercial real estate services firm JLL found 41 per cent of tenants expect to increase their use of desk sharing and co-working space as part of a post-lockdown work strategy.
JLL’s Global Flex Space Report found that, currently, only 3 per cent of the companies surveyed worldwide use flexible space for more than a 10th of their total office footprint, but it could expand to as much as 30 per cent in some countries by 2030.
However, the picture is less clear in Canada, cautions Jonathan Peretz, JLL’s executive vice-president and managing director for office and industrial in the Toronto area. The global survey included a number of markets that have reopened more fully than Canada, which is just emerging from another lockdown.
“However, companies still want people back in the office because nurturing and growing the company culture when everyone is connecting online is a big struggle, Mr. Peretz says.
“We’re also seeing big bets in the office market on the leasing side,” he adds.
That doesn’t mean the office model will look like it did three years ago, “but what we’re hearing from our clients is that the office is so important as a glue to keeping people connected.”