The workplace in flux

Real estate is working through one of the greatest shifts it has ever seen. The role and value of the workplace has shifted dramatically in the past four years and is still shifting; there is a greater focus on the workplace and how it is delivered, how it is used, how efficient it is and its wider impact on organizational strategies.

The day-to-day management and longer-term strategies for real estate are becoming increasingly complex, with greater consideration of issues such as sustainability, social impact, wellness and experience, as well as leveraging data and technology. 

While hybrid working has become the norm, the role of the office remains crucial.

Economic uncertainty has created two opposing forces for many organizations and real estate leaders: they need to transform their real estate strategies to align to new requirements and expectations, while continuing to drive organizational efficiencies. 

In this report, we explore how evolving workplace strategies are changing the way organizations are partnering with external advisors. We set out key drivers, benefits and the future for partnership models.

Transformed workplaces

Transformed workplaces

How strategic partnerships add value

How strategic partnerships add value

The role of technology

The role of technology

The future is dynamic

The future is dynamic

Re-imagining the workplace

In a world where talent is in high demand and capable of working from anywhere, an employee-centered workplace is a necessity. The success of such a workplace requires a people-first approach to real estate. The impact of the workplace on physical and mental health and productivity is profound, so employers are seeking the most modern, best located and healthiest space.

When employees can work from anywhere, companies have been re-imagining the purpose of their office space. Companies increasingly see their office space facilitating collaborative working, as well as being a place to strengthen culture and create a sense of belonging. More than 9 in 10 organizations are encouraging employees to work from the office in order to boost face-to-face collaboration, while nearly two-thirds expect productivity gains from more office time. Meanwhile, 58% believe office work will cultivate company culture and 45% believe it will drive innovation.

Sustainability

Sustainability has risen dramatically as a corporate priority in the past three years, and is also an expectation of the workforce. The Net Zero Stocktake found 929 of the Forbes 2000 list of the world’s largest companies had a net zero target in 2023, up from only 417 in 2020. Most companies are at an early stage of their net zero pathway, which means they need to get to grips with monitoring and measuring the energy use of their workplaces. The next stage is putting the hardware and software in place to track and minimize energy use.

Technology

Technology is at the heart of hybrid workplace strategies. JLL’s Global Real Estate Technology Survey 2023 found 91% of occupiers are willing to pay a premium for tech-enabled space and 85% planned to increase their tech budgets despite a challenging operating environment. Core technologies for corporate real estate include those enabling in-office collaboration and remote working, as well as solutions for wellbeing and data management. Technologies can also help to track and report building use, energy emissions and maintenance requirements.

Artificial Intelligence

Artificial Intelligence (AI) can enable intelligent buildings, which use sensors and data to manage light, heat, cleaning schedules and space usage. Understanding performance and efficiencies through data regarding both buildings and people will give organizations greater agility and responsiveness, which will ultimately help to reduce costs. Read more about the impact of AI on the real estate industry.

These are naturally interlinked: ensuring a healthy workforce means providing healthy buildings for example. Furthermore, there are overarching themes which impact all categories, such as ESG, macroeconomics and transformational goals.

For most organizations, outsourcing is a journey which has traditionally started with the tactical out-tasking of some services to multiple suppliers. That approach is now being reframed towards a strategic alliance with an outsourcing partner, globally integrated and collaborative with senior in-house management.

However, the manifold and growing concerns of corporate real estate executives, overlaid with hybrid working practices and macroeconomic uncertainty, demand a more strategic and tech-enabled outsourcing model which relies on real-time intelligence and data, and that can adapt to constantly changing demands.

Static provision of services does not necessarily match with hybrid working. Office occupancy can vary widely throughout any given week or month, leading to sometimes empty spaces, excess facilities management capacity and unnecessary operating expenses.

How dynamic is your workplace?

Static

Characterized by a rigid strategy which is slow to adapt to new workplace demands; uses manual processes, with little to no reporting and technology.

Reactive

Companies beginning to transform the workplace but limited by ad hoc, manual data gathering and reporting.

Responsive

Treating data as a valuable asset and moving towards automated corporate real estate insights and improvements. Still reliant on manual processes and producing insights which are retrospective, not predictive.

Predictive

Data and technology strategies are empowering automated processes. Designing workplaces and culture around how people work and collaborate, using technology, data and insights from automated analytics.

Dynamic

Companies have a holistic view of employee experience. Data collection, storage and analysis are automated, empowering machine-learning models to make workplace design and management decisions in real time or predictively.

Transformation-led outsourcing

What was outsourced?

This client wanted to form a long-term vested partnership to transform the way Facilities Management services were delivered and strengthen delivery capability across their global real estate portfolio.

The project involved global integration of previously regionalized operations, across portfolio services, capital management and workplace experience and operations, creating a one-team approach and standard set of reporting capabilities, playbooks and governance.

Result highlights

• Completed a global transition in under 3 months

• Captured 1,200+ leases and ancillary documents in year 1, creating and maintaining a reliable database to inform RE estate planning

• Dealt with the financial management of nearly 100 leases with an annual rent roll of $126M, improving governance and accuracy around billing validation and payments

• In year 1, dealt with 170 critical lease events including expiries and options, which resulted in the client being able to reduce their office footprint by nearly 500K SF, saving more than $12M pa and the remaining portfolio by more than 1M SF, delivering capital receipts of $160M

• Analysis of occupancy planning data has led to 20% of one campus location being closed on Friday, enabling cost savings and potential contribution to net zero targets

• Management of sensor and reservation systems has allowed data-driven approach to optimizing space utilization and facilitating office operation

The economic impact of Corrigo

238%

ROI and less than a 6-month payback period

75%

Reduction in maintenance spend for assets under warranty

80

Hours saved onboarding each new installation

Corrigo is a Computerized Maintenance Management System (CMMS) and facilities management platform offered by JLL Technologies. It is designed to empower facility managers in navigating high-volume work order, asset, and vendor management at scale. Corrigo provides a range of features and benefits to optimize maintenance operations and improve efficiency. A review of Corrigo highlights the following benefits:

• Cuts FM spend by 10%, including cost, time and people savings

• Saves $3.3 million within three years

• Delivers a 238% ROI in just three years and a payback period of less than 6 months

• Accelerates employee workflow completion by 75%

• Eliminates the cost of adding additional staff while supporting more locations

The past five years have seen massive changes in the way we work, from mainly office-based to home-based and then to hybrid, with that evolving to today’s office-led hybrid work model.

The workplace is still evolving and, with this, so is technology. In this context, dynamic partnerships offer a strategy for creating workplace value while controlling costs in the face of constant change. Leading organizations are recognizing the potential of dynamic partnerships to deliver what they need, when they need it. Data on the use and performance of buildings and people will form an increasingly important part of strategic decisions for companies and their real estate.

Creating dynamic partnerships for hybrid working is a journey and great partnerships don’t happen by accident. Companies setting off on this journey need to collaborate with stakeholders to identify priorities and clarify their goals. They should explore the options available to achieve their goals. The endgame for a strategic partnership is a collaborative, rather than transactional, relationship which delivers improved services alongside efficiencies, and is aligned with the organization’s goals.