The end of commercial real estate?

I was scrolling Twitter today and today’s tech twitter debate was about the end of commercial real estate. To no one’s surprise, many CEOs and employees of startups starting to realize how great working from home is and how much they can save by cutting office and food costs.

This was a trend that had roots many years ago even prior to when coronavirus was born. More and more companies are becoming distributed due to higher cost of living, improving technology, and cost savings to the company. Secfi operates with my product and engineering teams based in Amsterdam and our business/operations team based in San Francisco.

Distributed teams are the future, but is coronavirus truly the end of offices? I don’t see it. Yes, I have no doubt many companies will shift to start working from home more and shrink office spaces in general. Some companies will do this willingly. Some will be forced to. This was the trend we were seeing prior to covid, and this virus will accelerate the trend.

With that said, removing the ability to work from an office is a consequence that may likely result in less camaraderie and sense of belonging. Employees want to be given the option to work from home or the office for convenience, not to be permanently stuck working from home.

I sense people being forced to work from home fall within two camps, 1) those who cannot wait to go back to an office, and 2) those who cannot see themselves working from an office again. Offering only one of those options hurts your ability to recruit and attract top talent. I for one would be more reluctant to work for a company that has no office presence.

My prediction for the new normal is that almost every tech company will be much more open to working from home and there will be less pressure to go into the office. Leases will shrink and be more flexible, but there still be office space for those that want to come in.

Fact is that having an office and having employees come in can promote efficiency and team building if done correctly. I love seeing my coworkers in the office. Not everyone feels like me and that’s okay. Everyone works differently, but companies will need to cater to both ends of the spectrum.