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19 July 2021, France | Property Investment Management | News

The future of work: corporate real estate at the service of an ongoing societal transformation

On the eve of a summer of newfound freedom, it is interesting to consider the consequences of the health crisis on our daily lives. What is its impact on our work rhythms and environment? How can we make the return to the office a moment that employees look forward to, when 84% of them want to continue the teleworking experience? Corporate real estate offers many answers to re-mobilize employees and make them want to go back to the office.

The health crisis was sudden, unexpected, and coercive, taking us by surprise and plunging us into the unknown. It has forced us without warning to adapt our lifestyles and working methods, confirming, and accelerating practices already in place. Telecommuting, co-working, co-living, these new formulas redesign our practices under the influence of CSR issues.

The big winner of this crisis, telework has opened the field of possibilities for many companies, sometimes very reluctant. The eight million employees concerned, who are more autonomous, more responsible, and less tired from travelling, have said they are more motivated and more efficient. 84% of them would like to continue the experience, according to a Malakoff Humanis study. For companies, more satisfied employees mean more commitment and less turnover. Less travel also means less road traffic, optimized energy costs and, ultimately, less carbon emissions. An asset in a company's mobility plan.

A revolution at work is underway

However, the crisis has made us realize the limits of this disassociation. The office, more than a workspace, is above all a social place of communities. Welcome at Work, a concept of management and animation of the common parts of company buildings, does not propose offices but "a welcoming place of life" which brings meaning and well-being to work. To be attractive, the new offices will have to be built around moments of conviviality and value-added services: concierge services, sports and cultural events, networking, etc.

The formula, also adopted by coworking spaces, appeals to freelancers and very small businesses as well as large structures. The turnkey solution makes life easier for companies. Contentsquare, one of the world's leading providers of experience analytics, has announced that it will set up its Paris headquarters in the buildings of WeWork, a specialist in this field.

Another key topic for corporate real estate: location. After more than a year of experimenting with a new life balance, sometimes spent far from urban centers, there is no longer any question of coming to the office only to end up in an outlying area far from the city center. The need to socialize, especially among the younger generation, continues beyond the walls of the company. In this respect, Paris has confirmed its dynamism with a decline in take-up of less than 5,000 sq.m in Q1 2021 limited to -6% and only -3% for the Central Business District, while in Ile-de-France, an overall decline of -19% has been recorded compared to Q1 2020.

People and environment at the heart of real estate issues

In this context, companies are reviewing their office selection criteria not based on square meters, but based on the environment, the layout of the spaces, the services offered, and even the ecological impact of the buildings. These are all criteria that enhance the value of people and lead to substantial changes in corporate real estate.

For the players in the sector, this means thinking about more virtuous real estate projects. Projects that incorporate eco-responsible design - a trend supported by the EU's recent target of reducing carbon emissions by at least 55% by 2030 - and that take care of the modularity, ergonomics and decoration of the spaces, the materials chosen, and even the outdoor spaces. The Palais de Justice in Paris, located in the 17th arrondissement, offers a striking example of unexpected architecture, combining whiteness, luminosity, transparency and hanging gardens.

These developments towards greater architectural freedom must also meet a demand from investors to be able to transform real estate surfaces into residential housing. This is a promising market, as confirmed by Edgar Suites, a specialist in the transformation of offices into hotel apartments, which has just raised 104 million euros from BC Partners.

This is good news for the real estate industry because, as Léon Bressler used to say, a building is an asset that has to rotate and renew itself. In a market that is largely obsolete, this is the price that real estate will have to pay to keep pace with the ongoing societal transformation.

By Stéphane Guyot-Sionnest, Co-President and Founder of Catella France