Office spaces under the new norm
OFFICES will continue to be an essential part of doing business during and post the Covid-19 pandemic, even though their future at this juncture seems uncertain with so many working from home, property specialists said yesterday.
“Offices are critical to employee productivity and build a successful corporate culture. This is part of an effective talent retention and attraction strategy. Creativity, skill development and problem-solving also improves through group collaboration, which is best achieved in an office environment,” said Naeem Tilly, the head of research at Sesfikile Capital.
SA Reit Emira Property Fund chief operating officer Ulana van Biljon said: “Businesses need a place to gather and work – this will endure, but offices will evolve with changing times.”
She believed the new norm would favour office spaces that were greener, healthier and cost less to operate.
“Well-priced, modern, offices with green and healthier features that lower operating costs and are located in amenity-rich locations which are convenient for staff, will fare best going forward,” she said.
Location preferences could also change, said Tilly.
Some companies would continue to have central offices in major cities which many regard as essential to create a sense of connection and energy, while others might choose suburban office parks, which allowed for employees working remotely to visit the office easily.
Offices that were easily accessible and near transport hubs and amenities should continue to attract interest.
“In Johannesburg, we see the most interest in Rosebank, Sandton, Waterfall and Bryanston, while Menlyn continues to attract interest in Pretoria. In Cape Town, the V&A Waterfront office market rivals the CBD, while demand for Claremont and Century City remains firm. Demand in Durban is mainly in uMhlanga,” said Tilly.
Van Biljon said larger corporates that had been consolidating over the past few years might reconsider the risk of housing all employees in one building, as a positive Covid-19 case could mean a shutdown of the entire office.
“Regional offices could offer more business continuity, so we might see a trend for more, smaller offices which staff can move between depending on requirements,” she said.
Covid-19 sped up other changes already taking place in the workplace.
Van Biljon said offices had to offer user-friendly spaces that were convenient, had integrated meeting spots, eateries and break-away zones.
“Flexi hours and a combination of working from the office and home will increase. There will also be a need for flexible space and co-working. But, it is important that any office space is ‘guaranteed as clean’, certainly until a vaccine Covid-19 was widely available,” said Van Biljon.
Contactless ablution entrances would be in demand. Biometrics would move backwards, but facial recognition security could become the new normal.
South Africa’s office property sector is tied to the country’s economic health, which was already weak before the Covid-19 crisis resulting in a roughly 11% office vacancy across South Africa at the start of the year.
Bandile Zondo, the head of financial sector equity research at Standard Bank Group Securities, said cost-cutting was likely to be a priority for the average corporate near-term.