How Changing Work Practices Will Affect the Bangkok Office Market
The Thai workforce is changing and there is a war for talent in Thailand. This is changing the way that companies choose office space and the ways that they design and use their office space.
Multinationals and Thai companies have recognised that office space is a significant portion of their operating costs. Initially, companies would focus on cost and then realized that the location, quality and utility of a building were important and that in some cases, they would be able to get a more efficient workplace that would be attractive to staff if they paid more.
FOCUS ON SPACE UTILIZATION
The focus today continues to be on location, building quality and utility but now, in addition, the focus is on how companies use their space. The days when every manager had their own office are long gone and are seen as an inefficient use of space and barriers to communication. Each employee having their own desk may also become part of history. Companies want their workplace to encourage efficiency and collaboration, breaking down the silo culture and giving employees the choice of how they want to work.
Until recently, many companies set an office space utilization standard of one person for every ten square meters of office space. Today the new target is closer to one person for every six square meters of office space. At the same time, companies are in competition for the best employees and providing an attractive workplace may be the factor that helps companies win the battle for talent.
It would appear that the two goals of reducing the number of square meters per person and at the same time providing an attractive workplace are con- tradictory. This is not the case for most companies, however. A simple test is to look around your office during the work day and see how many desks are actually occupied. There are few workplaces where desks are occupied for the whole work day. The key is to observe how people work and use space and how management would like their staff to work better with more collaboration and teamwork and less barriers to communication and silos. The key is to design the workspace around how people work by providing activity- based design solutions including collaborative space, socializing space, focus space and meeting facilities. CBRE is rolling out new workplace strategies for our own offices with 22 of the total 372 offices now designed using workplace strategy. CBRE’S old Tokyo office was an open plan design housing 550 staff at a ratio of one person for every 8.5 square meters. CBRE’S new Tokyo office houses 600 staff at ratio of one person for every six square metres in a much better working environment.
WHAT ATTRACTS EMPLOYEES?
It is possible to reduce office leasing costs, increase productivity and recruit the best talent. This means selecting buildings where employees want to
work because of location, especially mass transit access and other facilities such as fitness centres and restaurants. It also means selecting buildings that are efficient in terms of floor plate, lifts and climate control. Equally important is designing a workplace that matches the employees’ work patterns and provides an attractive environment where people look forward to coming to work each day.
Although Bangkok office rents are among the cheapest in the region, they are rising. Despite the weak economy, demand has continued to grow and based on current forecasts will exceed the growth in supply for at the least the next three years. Rising rents mean that companies will have to pay more attention to space utilization. This means that more thought and time is required to be spent on a company’s needs analysis before looking at options available, whether that to stay in existing premises or relocate. The limited amount of choice also means that companies will have to commit to space earlier. This is al- ready happening with companies signing leases for space in buildings that are still under construction.
The whole process of analysing office space requirements and executing a chosen option is going to take longer because of the need for more strategic analysis and the limited number of alternatives.
James Pitchon is Head of Research at CBRE Thailand. He can be contacted at James. Pitchon@ cbre. co. th.