According to the US Census Bureau, the number of people primarily working from home tripled between 2019 and 2021. The rise of the COVID-19 pandemic resulted in people leaving the office in record droves for pajama pants and midday breadmaking.
The big question of 2022, as vaccination numbers increased and other risk reduction strategies went into place, was whether businesses should continue their work-from-home policies, adopt a hybrid working environment, or insist on a return to the office.
The other major question that has arisen is how work-from-home policies will continue to affect commercial real estate. If you search big-name articles about this trend, you’ll see anything from “Commercial Real Estate is Doomed” to “Commercial Real Estate is Booming.” In short – there’s no real consensus just yet.
We decided to put some questions concerning work from home to two members of the Trout Daniel & Associates Team: Arthur Putzel, Principal and Broker, and Stacey Berman, Associate Broker.
Work From Home Interview with Stacey Berman and Arthur (Art) Putzel
Are you pro or against work-from-home policies?
Stacey: I am neither for or against work from home. That decision to successfully work from home is dependent more on the type of work rather than the location. That said, periodic interaction is critical.
Art: I think it is a necessary part of the landscape going forward. Prior to Covid, we had two employees spending part of each week working from home and part in the office. From their feedback, that flexibility is a key factor in retention.
Do you see any benefits of a permanent work-from-home model?
Stacey: Companies can benefit from financial savings only as a result of utilizing less space. That said, there are many people that have been working from home for years prior to COVID. Those people tend to take positions that do not require interaction with others to complete their tasks. These positions are filled by people who are satisfied at the level they accept and in many cases don’t care that it can limit their professional growth because of the flexibility work from home provides them.
Art: So I am wearing two hats here, which conflict somewhat. My answer as a real estate agent would be biased toward having everyone back to the office; as an employer, I have to recognize the importance of flexibility. I agree that it depends on the nature of the work. Our brokerage business includes a substantial amount of creativity and serendipity, while our property management business is more amenable to individual work with a lot of straightforward data entry. However, even with the latter, I believe that it is critical that there be some periodic face-to-face contact, at least once per week.
What are your opinions on a hybrid model?
Stacey: Hybrid has financial benefits for a company as well, but limited for employees. It still doesn’t provide employees with their “own” space but does facilitate some interaction with those who are scheduled at the same time. Impromptu meetings, team building, and other types of benefits are seldom realized since the days tend to vary in order to accommodate the entire workforce.
Art: We are already operating with a hybrid model; some of our people work part of the week remotely, and a few of our agents are entirely remote. It works, but it is harder to keep the folks who are entirely remote front of mind when doling out assignments.
What is your opinion on shared workspaces?
Stacey: Messy, complicated, expensive.
Art: If the goal is to have a place for someone to sit when they are in the office, it’s fine. But, if the goal is to foster a feeling of belonging in the organization, a feeling of loyalty, I think that not having a place to call ‘home’ makes for a more disconnected workforce.
Stacey, in a previous conversation, you talked a lot about the work from home model not working in the past – what about the technology changes that have happened since COVID to make it more accessible to work at home? Does considering those change your opinion at all? (ie Zoom, the ability to see what people are doing on their work computers in real time, etc).
Stacey: While technology has certainly made it easier for the ‘work from home’ concept, it doesn’t allow for the personal connection that I believe is necessary for people to advance within a company and in their careers if that is their choice.
Conducting a zoom meeting can be frustrating and unproductive. The exception to this is in a lecture format where all participants are muted. In that scenario, people have the ability to mute or eliminate video which makes the utilization of the Zoom concept not as intended. Otherwise, in a Zoom meeting, people have a tendency to talk over one another and not always listen. As a meeting progresses, people tend to lose their attention, or if they ask questions those can be ignored.
In the end, it’s easier to dismiss people on Zoom than it is in person.
As for advancements in technology, companies also have the ability to monitor the amount of time and computer keystrokes employees use throughout the day. Many people do not like this ability and find it to be invasive. In some cases, they choose not to utilize devices that track usage, location, etc. Not all technology is accepted within the workplace. Working within an office environment eliminates the need to constantly track people and use this technology.
Art: A good part of what comes out of meetings is the ‘hanging around’ and chatting afterward; that doesn’t happen in a Zoom (or Teams) meeting. Zoom is superior to a scheduled phone call, but definitely inferior to in-person. In fact, I believe the hierarchy of quality communication is: In-person, Zoom/Teams, telephone, email/snail mail, and text. The quality of the communication, the capacity to include inflection and nuance, decreases with each one. Certainly, if there is a specific item that needs to be worked out between parties in different locations (e.g. access to a store in a shopping center), being able to all see the same drawing without spending downtime in travel makes tremendous sense. But again, this works if the reason for the meeting is to iron out specific issues, not to form meaningful relationships.
Do you think that people lose productivity when they work from home instead of in an office setting?
Stacey: I believe that people are conflicted when working from home. They can accomplish multiple tasks that are not work-related during the day, which can make them feel guilty. They also can disappear if they choose as long as a task is completed. Truth be told, who would know?
That said, there are many positions that do not require nor have ever required “in-person” work environments. These positions are designed to have people work independently and don’t require team interaction. Companies focus on task completion rather than the amount of time it may take.
Art: I have always said that if you treat people like professionals, they will behave like professionals. In general, I have found that to be true (a couple of employees in my history have made a liar out of me). One of my people does indeed do personal things during the day, but I find them working odd hours in the evening. In general, I don’t think productivity is affected unless the individual does not have access to the same resources.
How do you think working from home has already affected the CRE market and will affect it going forward?
Stacey: I believe the initial knee-jerk reaction was to reduce space and allow people to work from home. As time moved on, I believe companies are again finding value in having people return to the office for in-person work, training, team building, and meetings. It allows for people to network in person rather than just occupying a square on a screen. For an employee, their results, style, and productivity can be recognized in person more frequently than in a virtual environment which ultimately helps secure their employment and advancement within an organization.
From a company’s standpoint, finding space virtually can be difficult and in-person meetings, showings, etc are necessary in order to move forward with space decisions.
Art: I just read an article that contrasted the sag in demand for central city space to the increase in demand for suburban space. We seem to be heading towards a situation where work’s proximity to home (as opposed to working in the home) is important. The conversion of downtown office buildings to residential should be good for the remaining downtown offices.
What do you think a perfect working situation looks like in a post-COVID world?
Stacey: Like any other pandemic that the world has experienced, I still believe that we need in-person work environments for companies to grow which then allows employees to prosper and advance.
Art: I tend to agree.
Is there anything else on this topic that you would like to share?
Stacey: Whether it’s Covid-19, the flu, or the next pandemic, technology has enabled us to pivot quickly but not always productively. You cannot control what or who you cannot see. It’s easier to eliminate people that you never see or meet and who remain invisible to you rather than those that become an integral part of your team.
From an employee’s perspective, it’s difficult to prove your worth and secure your employment if you are nothing more than a number within a company.
That said, there are still positions that are designed to be remote from the start and those that fill them are satisfied with what they do and don’t expect to rise the corporate ladder beyond the daily task displayed on their screen.
Ultimately, the work-from-home model isn’t going anywhere for the moment. There are still too many unanswered questions to make any definitive statements – and all individuals have to do what they feel is right for their health and wellbeing, while businesses will continue to do what they can to balance their bottom line with employee needs.