FUTURE WORKPLACE - Devon & Somerset Law Society · Millennials respondents see workplace quality as...

1CBRE

FUTURE WORKPLACETHE CHANGING REAL ESTATE NEEDS OF THE PROFESSIONAL SECTOR

November 2019

2CBRE 2 WORKPLACECBRE

1. What’s Occupying the Occupier?

2. Future Workplace

3. Questions

CONTENT

3CBRE

8 KEY INSIGHTS - DISRUPTORS

WHAT’S OCCUPYING THE OCCUPIER?

4CBRE

42% Technologydisruption

Source: CBRE Research, 2018

#1THE NUMBER ONE PRIORITY

5CBRE

ARTIFICIAL INTELLIGENCE

48%of London law firms

are currently using AIacross all industry

sectors globally

23%

compared with

of London law firms either use AI already,

or plan to do so in the future89%

Source: CBRE Research - Law in London 2018

AI ADOPTION

E-discovery63% Due

DiligenceResearch

Administrative

Legal Support

Document

Generation63% 47% 42% 32%

“AI could improve lawyer output on due diligence by anything from 20% to 40%. Successful firms will be the ones that are proactive and adapt.”

Jason MartyGlobal Director of Operations, Baker McKenzie

6CBRE

ARTIFICIAL INTELLIGENCE

AI IMPACT ON HEADCOUNT

Almost halfof firms believe there will be a

reduction in headcount at junior and

support levels

Over 30%of firms were unsure of

the potential impact

on headcount at each

level

Over half of firms believe there will be no

impact in headcount at senior

level

Impact on senior employment level

Impact on junior/support

employment level


7 CBRE | CONFIDENTIAL – NOT FOR DISTRIBUTION

#2ECONOMIC UNCERTAINTY

9CBRE

BREXIT

None

Significant

Minor

2%

26%

72%

EmploymentLevels

36%

5%

59%

Profitability

Perceived Impact:

of firms do not

expect Brexit to

have a

significant

impact on their

employment

levels

98%of firms do not

expect Brexit to

have a

significant

impact on their

profitability

levels

95%

70% of firms have no contingency plan

to relocate business elsewhere in Europe

IMPACT ON LONDON LEGAL BUSINESS



#3TALENT – THE NEXT GENERATION

11CBRE

5 GENERATIONS SIDE BY SIDE BY 2020

Hardship

Loyal

Disciplined

Traditionalists

Pre 1945

Optimistic

Enjoy mentoring

Strong work

ethic

Baby Boomers

1946-1964

Independent

Innovative

Strong

communicators

Gen X-ers

1965-1979

Tech-savvy

Collaborative

Focus on greater

good

Millennials

1980-1995

Digitally fluent

Practical

Flourish in diverse

workplaces

Gen Z-ers

After 1986

12CBRE

A FAULT LINE OR SIMILAR PROPERTIES?

Baby Boomers

1946-1964

Gen X-ers

1965-1979

Millennials

1980-1995

Pay/financial benefits



Location/easy commute

Job security Job security

Job securityLocation/easy

commuteFlexible working

Interesting/enjoyable job

Interesting/ enjoyable job

Location/easy commute

Flexible working Flexible workingOpportunity to career progress

Importance of Workplace to Millennials

respondents seeworkplace quality as important when choosing an employer

will trade other benefits for better workspace

PRIORITIES WHEN CHOOSING A JOB

Source: CBRE, Millennials: Myths & Realities ReportSource: 2016 Great Place to Work Institute UK


#4 REAL ESTATE MARKET

14CBRE

Mar

OFFICE RENTAL LEVELS

INCREASING OCCUPATIONAL COSTS

• RISING BUILD COSTS

• LOSS OF OFFICES TO

ALTERNATIVE USES

• LACK OF NEW DEVELOPMENT

• STEADY DEMAND

• RESULT RISING RENTS

Bristol£35.00 + psf

Exeter £67.50 psf

£100.00 psfTotal Occupancy Cost

Source: CBRE Research

City Central rents Out of town

rents

Bristol £35 + £23

Exeter £19 £20

Bridgwater £25 £14

Cheltenham £30 £15

Taunton £12.50 £16.50


#5REDEFINING SPACE NEEDS

16CBRE

Legal240 sq ft

Per Person

Corporate140 sq ft

Per Person Prof & Fin

Services 120 sq ft

Per Person

Banking100 sq ft

Per Person

DO YOU OCCUPY TOO MUCH SPACE?

TYPICAL UTILISATION

50-60%


17CBRE

OPEN PLAN VS CELLULAR:

Rent and Space Impact

Office layouts of the CBRE Legal 100

67%Predominantly cellular

configuration.

26%Completely or majority

open plan

7%Activity-based

working

Sp

ac

e

Cellular

445 sq ft

per fee earner

Open plan/activity

based working

258 sq ft

per fee earner

42%Less space

per fee earner Re

nt

£21,660

per fee earner£13,320

per fee earner

39%Less space

per fee earner

CellularOpen plan/activity

based working


18CBRE

THE RISE OF AGILE WORKING

Law firms’ primary

goal for agile working

25%

28%

15%

17%

15%

How law firms are implementing agile working

97%82%

53%42%

Allowing working

from homeProviding technology to

untether staff from the desk

A choice of different work

settings in the officeDesk sharing

Increased workplace

efficiency

Greater

collaboration and interaction

Wellness and

wellbeing

Recruitment

and retention

Other

30%of firms had adopted an agile

working policy by the start of 2017

61%of firms had adopted an agile

working policy by the start of 2018

2017 2018


#6THE FLEX REVOLUTION

20CBRE

EXPECTED CHANGES IN CORPORATE PORTFOLIOS

Source: The Instant Group & CBRE

100%

80%

60%

40%

20%

0%

Office Flexible/

Co-working space

Retail Data centres Industrial and

logistics

30%

50%

19%

11%

6%

64%

33%

20%

15%

36%

16%

28%

44%

16%

14%

NO CHANGE CO NTRACT EXPAND

CONTRACTNO CHANGE EXPAND

Innovation and talent are increasingly mentioned as reasons for taking flexible

space


#7WELLNESS & PRODUCTIVITY

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EMULATE NATURE AND WE FUNCTION AT OUR BEST

FRESH AIR, LIGHT, COLOUR, NOISE, ASPECT, VARIETY

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WELLNESS: A CORE PART OF USER EXPERIENCE

Have a wellness programme

or plan to introduce one

71% 80%

Have preference for

wellness-capable buildings

92%

Source: CBRE Research, 2018

20182017


#8THE EMERGENCE OF SMART BUILDINGS

25CBRE

CHANGING MOTIVES?

62%42%

Operational efficiency

39%

56%

User experience and productivity

FUTURECURRENTLY

BMS IS AT THE HEART OF SMART TECH OBJECTIVES FOR REAL ESTATE TECHNOLOGY

Source: CBRE Research

26CBRE

HOW DEVELOPERS ARE RESPONDING

“Workplace is much

more than demised

office space”

British Land

Incubator / Accelerator space

Co-working / Serviced offices

3 year flexi-lease / Semi-serviced

5 to 7 year conventional floors

Concierge / Bike storage / Gym & Leisure Facilities

Roof terrace / Event Space /Bar / Restaurant

Shared food hall / Conference auditorium

“Faced with

the option of two similar buildings… we would always choose one with a flexible offer…”

Global Real Estate Director, Professional Services Occupier

PROVIDING SHARED EXPERIENCES, NOT JUST A SPACE FOR WORK

CBRE

Future WorkplaceDelivering Experiences

28CBRE

CHANGE-MAKING

HAPPENS WHEN PEOPLE

FALL IN LOVE WITH

A DIFFERENT VERSION

OF THE FUTURE

SETH GODIN

”

“

INFLUENCING THE TRADITIONALISTS

© 2017 CBRE, INC.© 2018 CBRE, INC.

LOOKING BACK: WORKPLACE TRENDS

focus on community, values and relationships

activity based work

wellbeing at work

amenities and service as differentiators

brand integration

workplace as a service

hospitality

tech enabled experiences and services

virtual interactions cause connectivity to suffer

people can work anywhere, and do

demand for greater flexibility

offices become more standardisedand more sterile

focus on focus and better collaboration

increased choice, in and outside the office

increased density and variety of space types

focused work suffers

office utilisation declines

obsession with millennials

density without variety

collaboration in open work space

generations in the workplace

workstations and offices get smaller

rise of remote work programmes

EFFICIENCY

MOBILITY

TALENT

INNOVATION

mobile technology innovations

rise in co-working

20

05

20

05

20

10

20

10

20

15

20

15

shift to output based performance

LOOKING BACK: WORKPLACE TRENDS

30CBRE

year facility life cycle incompatible with

demand to upgrade technology every 2-3

years.

10

INCREASED AGILITY

global respondents desire better collaboration – a main

driver of their workplace strategies.

69%

EFFECTIVE COLLABORATION

see the workplace as a leaver to attract & retain

talent, and be a differentiator from competitors.

51%

TALENT MANAGEMENT

will focus on workplace & space efficiency programs for portfolio flexibility ahead

of headcount changes.

47%

SPACE EFFICIENCY

BUSINESSES CARE ABOUT

31CBRE

of employees are more engaged when

organisations provide work-life support.

38%

WORK FLEXIBILITY

of millennials agree that wellness facilities are

influential when taking a new job.

69%

EMPLOYEE WELLBEING

of employees said their company uses the latest

technology to enable them to effectively do their job

44%

EASE OF WORK

of employees rate company culture as very or extremely

important when selecting an employer

47%

COMPANY CULTURE

EMPLOYEES CARE ABOUT

32CBRE

A RADICAL TRANSFORMATION OF TODAYS WORKPLACE

NEW MODEL

A destination employees want to go

OLD MODEL

A place employees have to go to do their work

2015

2020

20

20

20

15

brand integration

activity based work

wellbeing at work

amenities and service as differentiators

focus on community, values and relationships

Workplace as a service effective efficiency stymied by 1:1 assignment and lack of change management

push back against have/have-nots of flexibility

great culture and organisational values will drive employee attraction

personalisation and ease of access as hallmarks of corporate amenities

hospitality

tech enabled experience and services

Flexible work policies cease to exist; employees

work more flexibly than ever

Organisations embrace coworking

maintaining efficiency, offering

choice and meeting peak

demand

Technology tracks utilisation

and helps people

connect with one another in

meaningful ways

Recommendation engines

help employees be

deliberate about where

and when they work

Machine learning

changes the way people use technology and

interact with space

Consumerisation will inform CM

Employers offer

enhanced hospitality services to

attract talent

Hospitality is the new performance standard for facility

management

CRE, Facilities, IT & HR will all be measured

on their collective ability to

create vibrant social

networks

EFFICIENCY

MOBILITY

TALENT

INNOVATION

LOOKING AHEAD: TREND PREDICTIONS

[email protected]

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