404-919-8470 info@atldigi.com

ATL
Digi

Atlanta
Digital

 

ATL
Digi

Atlanta
Digital

 

North American tech workplaces, once the vanguard of workplace innovation, are still catching up to new work patterns, according to new research by Hassell and Density. With average peak utilization not exceeding 34% in tech offices, up to $40 million in rent costs are wasted annually on underused space¹.

The State of Tech Industry Workplaces examined a full year’s usage of tech workspaces to understand the relationships between utilization, return-to-work (RTO) policies, and layout in more than 1.4 million square feet. The report, by Hassell Head of Research Dr. Daniel Davis and Density Director of Analytics Annie Cosgrove, examined 1.4 million square feet of workspace in North America’s tech sector between May 2023 to May 2024.

Tech Workplaces
(Source: The State of Technology Workplaces, Hassell and Density)

 

Among the report’s key findings are:

  • The impact of return to work (RTO) policy on office utilization isn’t as significant as you’d expect. Going from a policy that lets employees decide when to come in, to a mandatory three-day, in-office hybrid policy only increases peak daily utilization by 17% (from 29% to 46%). This suggests that hybrid RTO policies aren’t being fully enforced or respected.
  • Employees who can decide where they work spend twice as much time in meeting rooms when they’re in the office compared to those with formal hybrid policies. 48% of in-office time for employees who get to choose is spent in meeting rooms vs. 29% of time for employees who have a three-day per week policy and 23% for those in-office two days per week. When given a choice, employees come in to meet people.
  • Tech companies over-optimized for open-plan offices. Every workplace studied by Hassell and Density is open plan, with only a handful of enclosed offices. These open spaces don’t work for the video calls and hybrid meetings that are critical to new work patterns. As a result, meeting rooms aren’t just places for groups to collaborate, they’re also forced to function as quiet space for video calls and focus: 36% of the time meeting rooms are used as private offices or phone booths.

“Tech companies have traditionally been workplace leaders,” said Dr. Davis. “Their amenity-rich offices nurtured billion-dollar businesses and untold envy. Then the pandemic happened. Many quickly adopted hybrid and remote work. Now, some of those offices sit underutilized while others struggle to accommodate new work patterns.”

“This misalignment of space and work patterns doesn’t just result in empty chairs, it represents a significant drain on financial and environmental resources,” commented Cosgrove. “Even in 2023, average annual rents for San Francisco-based tech companies exceeded $8,000 per employee (CBRE). And buildings account for 39% of global CO2 emissions. As thought leaders in workplace design and culture, tech companies are positioned to solve these challenges that are plaguing workplaces across the world.”

workplace designDid You Miss Our Future Of The Data-Driven Workplace Webinar?

In this free video webinar, we dive into recent research around collaboration, productivity and the role of the office, and share how workplace data can inform facility decisions. Read more…

The State of Tech Industry Workplaces offers three tips for businesses looking to optimize their workplace utilization and design. By leveraging the report’s findings, companies can:

  1. Implement innovative workplace designs that cater to the evolving needs of hybrid work models.
  2. Maximize space utilization to reduce costs and environmental impact.
  3. Foster a culture of collaboration and adaptability by creating versatile work environments.

“Our aim with the publication of The State of Tech Industry Workplaces report is to trigger a shift in workplace design and utilization,” explained Dr. Davis. “Tech companies can thrive in the era of hybrid work through better design that minimizes workplace friction that frustrates employees and negatively impacts culture.”

¹ Up to $40 million in rent costs are wasted annually on underused space (based on a CBRE study of annual rents for tech companies in top U.S. metro areas).

Click here for more facility management news and information about Interiors.

Facility Executive Magazine