Office building density is going up. And up. The average amount of square feet (SF) per worker was 250 at the start of many active leases. It has now dropped to 185, and some Gridium buildings have told us they are seeing spaces go as low as 100 SF. The trend is happening so quickly that buildings leased out five to ten years ago will have to reposition, rethink, and upgrade to stay relevant. Polished concrete floors on the 14th floor? It’s happening.
Some numbers will help put this into context.
Let’s use a 100,000 SF office building as an example. Using traditional numbers, this building will have 400 workers in it (100,000 SF / 250 SF per worker). This same building at today’s average would have 540 workers in it. That is a 35% increase in the number of people in the building! This increase puts additional stress on the building and its systems, including parking, utilities, elevators, restrooms, and mechanical equipment.
Why is this happening?
Great question. 3.25 billion more people live in cities today than they did in 1950. At a macro level there is quite simply many more people and roughly the same amount of space. The result is smaller spaces (think micro apartments). In addition to increasing populations, cities continue to be the forefront of robust earning potential, dynamic opportunities, and startups.
Technology, in particular cloud computing, is having an even bigger effect. Many offices, including some law firms, are now paperless — no more filing cabinets or large copiers. Wireless technologies and laptop computers untether workers from their desk, enabling newfangled office designs and telecommuting. Fewer walls, more dogs.
Photo from Flickr user “Tim”
A new wave of cost cutting and efficiency has ripped through the economy since the financial crisis and Great Recession. Older office designs and corporate hierarchies with assigned offices and desks see utilization rates around 50%. These types floor plans didn’t survive the economic upheaval of the past decade. Firms that have transitioned to shared space and open floor plates see utilization rates jump as high as 95%.
How do workers feel about this?
Tenants today want collaborative work spaces that promote in-person interactions, take advantage of natural light, utilize technology, and allow for a flexible work environment. The most common tactic to achieve these desires is open floor plates. This also means more flexible space–anecdotal evidence from Gridium buildings suggests that for every 2 square feet of densification, one square foot of flexible space is added. And the flex space is put to a wide range of uses… think foosball tables, massage nooks, nap rooms, and yoga spaces.
And all of this means your building will likely change.
Relevance in the office market is leasing power and the trend of increasing worker density is forcing owners and operators to change to stay relevant. Structural population shifts and advancing technology have ensured the trend is here to stay. Buildings that have been leased out ten years ago as well as markets that have yet to experience this trend will be in for a wake up call soon enough. The additional stress on buildings and management resources will force owners and operators to have systems and tools that are up to the challenge.
