Andrew’s Insights – June 2021

Written by Andrew Millar, CEO & Founder
Returning East to West

The return to office has begun. Through our global footprint of clients, data is streaming in from around the world. Occupancy levels in Asia Pacific were the first to start climbing back towards 50% and now Europe is showing signs of returning over the last 8 weeks.

Data from North America tells a different story with very low occupancy levels across the US and Canada. We are expecting to see a significant spike in occupancy in September with many clients holding off on plans to return until after a much-needed summer break outdoors for everyone. It’s fascinating to have a front row seat as these global patterns emerge.

Intent Versus Actual Behavior – The Data Blind Spot

One of the biggest challenges companies grapple with is knowing how their people are going to return– or not return. A question we’re hearing from our clients’ time and time again is what’s the pattern of office re-entry going to look like across their portfolio?

Our clients are sending out employee surveys to try and find the pulse of how people are feeling and getting promising responses. But before you send one, I’ll let you in on a little secret: your people are going to say they want to start by coming in “two to three days a week.” That’s their intention, perhaps, and it tells you what kind of demand you should prepare for, but people aren’t exactly good at doing what they said they would do in a survey. When we compared survey data with actual behavior, that “two to three days a week” response translates to occupancy still below 5% on average.

We can send out surveys, look through pre-pandemic data or data from booking systems and calendars, but that only tells us what people planned to do, not what they did. Here at Relogix we’re calling this “intent versus behavior.”

That 5% occupancy rate will naturally start to rise but the big unknown is by how much and at what pace? In data analytics, we call this a “blind spot.” The reality is no one really knows what’s going to happen next. We haven’t experienced and lived through a global pandemic in the last century, so we have no historical data to rely on to build our models.

That is the blind spot for all of us, we don’t really know how this is going to evolve. But I can promise you we’ll be watching this unfold by the minute and keep you posted as it develops.

The Office is Dead, Long Live the Office (Or Just Work Anywhere)

Who knows what’s going to happen next in The Great Work-From-Home Debate. But one thing is for certain, a higher percentage of people will continue to work from home. It’s hard to say exactly what that percentage will be but it’s certainly going to be higher than we’ve ever seen.

For companies who had a lease ending over the last year or have one coming due, it’s a safe bet that some or all that space is now on the market. I find it difficult to imagine anyone signing a new 5- or 10-year lease right now. Some organizations have exited leases where they could or they’re just decreasing square footage overall. They’re using space-as-a-service as a flexible alternative while they navigate their way through the uncertainty. We’re also seeing a spike in demand for serviced office space. Companies are gobbling up small pockets of space in major markets. This gives them the flexibility to offer employees a place to go to get out of the house or to meet and collaborate as an additional benefit that will help attract and retain talent.

For Corporate Real Estate leaders – the stewards of space, valued customers, and kindred spirits – there’s no shortage of challenges ahead as we try to navigate these changes together. The office is dead, long live the office (or just work anywhere)!

Flex Office Acceleration

After being in the corporate real estate space for 15 years and studying data from hundreds of millions of square feet of office space, Relogix is integral to the flexible office movement. There’s been a slow and steady shift to activity-based working with unassigned seating and open collaboration. Although adoption has been slow, and the vast majority of global office space is still one to one seating.

Covid is the catalyst that accelerated the change to flexible work environments. During the pandemic, we saw a surge in unassigned seating, free address, and hoteling. Now, companies are setting occupancy limits as they slowly roll back to the office. It’s easier to facilitate the return to office with free address and desk booking, so companies made the shift quickly towards flexible workspaces. We are watching closely to see how much office space gets cut over to free address during the return and how much stays that way permanently.

Announcements
Global Reach

Great news: Relogix is continuing to expand our reach around the world. We are now in 18 countries! Our clients have global portfolios, so we’re always looking at new countries to expand into. This expanded reach is made possible with the continued support and success of our global partners like Lenovo, Ricoh, and many others.

Every new country takes time to get hardware certifications, set up our supply chain, and then test our hardware. Our top-notch Operations team always goes above and beyond to help our clients and get all these pins on the map. Requests are coming in quickly right now for new countries, so we expect our coverage to expand quickly over the next 6 months.

Let’s Get Real Podcast

We’ve launched our first ever Podcast: Let’s Get Real! Listen on iTunesSpotify and Google Podcasts.

Sandra Panara, Director of Workplace Insights, has gathered a panel of experts, including an HR specialist, employment lawyer and workplace anthropologist. The first episode is all about flexible work and what that will look like as people start to emerge from the pandemic and head back to the office. The episodes are only about 15 minutes long, so take some time to check it out and follow for more episodes coming soon.

Relogix in the News
Bloomberg TV: Andrew Millar, Relogix + John Gordon, Lenovo #BeyondInnovation Interview

Check out my interview on Bloomberg News! It was great to sit down with John and Anthony to discuss how Relogix and Lenovo are redesigning the office workspace to keep employees safer, happier and healthier than ever with their new Think IoT ecosystem.

Artificial Intelligence Meets Portfolio Optimization

We are very excited to announce that we are joining forces with Dr. Graham Wills, a pioneer in the field of Predictive Analytics and Machine Learning, to advance Artificial Intelligence in the field of Corporate Real Estate.
Hailing from IBM, Dr. Wills is a well-known researcher in the field of spatial data exploration and monitoring. Relogix is committed to helping clients optimize their portfolios by eliminating wasted space which will reduce their real estate spend. With buildings sitting empty over the past year, the historical data patterns are mostly out the window.

The industry needs advanced machine learning capabilities to accurately forecast demand for real estate moving forward. Dr. Wills is collaborating with Relogix to lead advancements in portfolio optimization to enable CRE leaders to more accurately forecast and predict their future real estate needs. With the help of Dr. Wills, we are excited to bring these advances in AI to our clients and the industry.

About the Author

Andrew Millar, CEO & Founder of Relogiix
Andrew Millar, CEO & Founder

Andrew’s mission is to turn data into valuable outcomes. With over 20 years as a corporate real estate solutions and insights provider, Relogix founder and CRE veteran, Andrew Millar, recognized the need for technology in the CRE industry. He founded Relogix out of a need to create solutions to help organizations evolve their workspace and get high quality data to drive strategic decision making. Andrew believes that the key to evolving workspace and strategic planning lies in data science. Just like the workplace, data science is progressive: it is a journey of perpetual discovery, refinement, and adaptation. Andrew has since created proprietary sensor technology with the needs of corporate real estate in mind – technology created for CRE professionals by CRE professionals.