Companies worldwide are under tremendous pressure to drive smarter space strategies. The breakneck speed of digital disruption. Uncertain economic growth. Geopolitical risk. Fierce competition to keep innovating. These factors and more are disrupting business as usual, forever changing the way people work and how we use space.
Which may leave you wondering, what’s the best way to plan for the future? To help you know what’s coming, JLL just released its annual perspective on the top 10 global corporate real estate (CRE) trends in 2017.
Discover how macro issues like intelligent automation, human experience and market volatility could impact the built environment and how global executives are planning to adapt.
We’ll dig in to several of these topics throughout the year to share what you can do to keep up. Stay in the know: subscribe for weekly updates.
The future of the world and workplace is difficult to forecast, especially as we see more volatility in politics and economies worldwide. CEOs globally are concerned about uncertain economic growth, market transparency and unforeseen risks like cybercrime that raise questions about which cities are best for growth.
20 million people worldwide are working from a “third space” for part of their work weeks—that’s a spot between work and home. When they are in the office, 34% of their time is spent away from their desks. As our work lives shift and the global stage keeps changing, businesses can’t afford to stand still. Agility is critical in an unpredictable environment and adaptive companies will perform best in 2017 and beyond.
What does this mean for you? If you have several locations, make sure you have flexible lease terms and space that can be used a different way. Need less space? Rent as event space, sublease to a startup or even invite them in to cowork. In your office, select flexible design, modular furniture and strong mobile support.
Real estate used to be seen as a cost, and now we understand how it adds value when it’s efficient and drives higher productivity. But in the future, it won’t be enough to have efficient space. Real estate decisions like when to lease, where to locate, and what to build will be under intense scrutiny to ensure that they achieve the highest possible performance.
Your workplace should not only be highly efficient by itself, but in proximity to the strong talent, innovation and market momentum outside your four walls. When optimized, these factors add tremendous value to your business, but unless you’re in their midst, it’s difficult to generate them on your own.
57% of companies are actively reorganizing their business, and high-growth startups are at the forefront of this trend. Intelligent and sustainable growth will be a priority for companies in 2017, and they’ll look more toward collaborative partnerships and M&A to achieve it.
No matter what side of an acquisition you find yourself on, you can help ensure a successful agreement by understanding your real estate’s role in it. Not only are there financial implications for both companies—from leadership and investors to shareholders and stock—but there are also day-to-day implications for employees when you merge two cultures.
Innovative companies across the world generate higher shareholder returns than their peers and many CEOs believe collaboration is the gateway. The workplace will need to support open collaboration, between employees and even outside the office in shared space. Continuous innovation will become a core component of real estate strategies because physical space can either help or hinder communication, new ways of thinking and reasonable risk-taking.
The workplace is more than property, it’s an environment that can cultivate a positive experience if it provides a sense of engagement, empowerment and fulfillment. Employees expect the workplace to make them feel comfortable, committed and in control—not unlike how they feel outside the office. Life and work are blending more and more, and a workplace that values human experience will attract more talent and keep them on board.
The human cloud encompasses a network of workers. We have the full-time employee, the part-time worker, the freelancer, the contractor and now even robots. In 2017, the growth of contract work and the rise of artificial intelligence have the potential to change the way we source talent. From there, it will likely impact headcount in the office, systems to support collaboration across networks and locations, and ultimately our need for square feet as people continue to work elsewhere.
A combination of artificial intelligence and automation are redefining roles and business processes. 9% of jobs are at risk of being totally automated, while 50% to 70% could be radically transformed—and likely made a lot easier. The vast majority of CEOs are considering integrating more automated processes over the next few years, for example to automate facilities management like lighting and HVAC. Or through advanced analytics that continuously monitor the data on all your offices and tell you when your lease is up on which building.
In the future, more companies will begin to create proprietary tools that disrupt entire industries. Uber did it with taxis, Airbnb with hotels, and in the future perhaps drones will transform distribution. It’s hard to say what could disrupt the workplace next, but smart building technology is becoming more ubiquitous. The most advanced companies have integrated systems that control energy efficiency, portfolio management (like lease data and tenant information) and an intelligent concierge that can learn and react in real time.
For businesses, the power of AI and predictive analytics can help mitigate risk, boost productivity, nurture employee experience and deliver enormous cost savings.
Companies will evolve beyond sustainability to a holistic view of corporate philanthropy. One that considers their impact on the environment, their people, their community and even the world at large. 75% of CEOs surveyed by PwC said that measuring the “total impact” of their companies’ activities is important for long-term success. That includes 1) a workplace that’s clean, green and supports worker wellbeing, 2) a building that’s LEED certified and energy efficient, 3) corporate policies that support diversity, inclusion and community investment, and finally, 4) philanthropic efforts that ripple across the globe.
Whether you’re familiar with all of these changes or only a few, they’re trends to prepare for today. Companies who can leverage new technology, navigate tricky markets, inspire talent and use real estate to their advantage will be more secure. Even as business continues to change.
To see the full report, click here.
JLL Staff Reporter, Behind-the-scenes
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