Occupancy has been on my mind a lot lately. The primary purpose of commercial office buildings is to provide a place for employees to work from. But for most companies, if you provide 100 desks you have no idea how many are used on an average day of the week.
Empty seats are no different than wasted space. $5,000 to $10,000 per year is about average for the annual cost of a seat (some companies may be more or less). If you have 1,000 vacant seats globally you could easily be letting $1M fly out the door every year. This isn’t simply a theoretical exercise either. As companies become more sophisticated in their CRE policies, real estate can quickly become either a competitive advantage or disadvantage.
Workplace policies done right can be a huge competitive advantage. When interviewing potential employees, a well articulated workplace program that details the company’s policies on work-from-home, seat sharing, travel and personal technology can be the difference between them joining you or someone else. Even if your policy is no work-from-home, being able to say how your office is designed to promote collaboration can overcome any negative thoughts. If you can’t articulate your policies or show how your office supports them you could quickly be losing top talent.
It all starts with occupancy levels though. No amount of collaboration programs can overcome an empty office. Empty desks remove energy from an office and saps the collaborative energy. It makes employees feel like there are missing pieces. Full desks are the opposite – it promotes energy and collaboration. It forces people to conference rooms with groups and to schedule time to think.
The problem is that the tech to measure real occupancy has not made it out of niche status. For the most part CRE orgs have to rely on word of mouth to understand office dynamics and most office managers fudge that information while seeking their ideal office – which typically involves larger space.