News & Research Archive

Is Mobile Technology Eliminating the Need for Office Space?

Apr 26, 2013

 

In a recent report on the state of the office market by Cassidy Turley, new office development is down 30 percent while office vacancy has only grown by three million square feet in total across the country. This does not fare well to a true commercial real estate recovery in comparison to how our overall economy has been recovering. The overall unemployment rate has not shown a significant reduction, which is always tied to an overall reduction in office vacancy, but the Cassidy Turley report suggests something else that is preventing a true recovery from occurring in the commercial office market recovery: mobile officing. The development of mobile offices is depleting the need for office space as businesses are scaling down their offices.

CBRE just announced a nationwide program to reduce their office space requirements by creating new mobile offices – where there are no assigned offices, let alone desks for real estate agents. Here, the largest real estate company in the world is re-structuring their offices to meet the new demands of mobile real estate agents while sending a message that offices as we know them are no longer needed. Conventional businesses are joining technology firms and reducing the need for private offices in favor of open plan offices – decreasing the need for square footage and thereby, rent.

The growth of mobile officing directly relates to salespeople and how our services are used. With firms needing less space than before, this means that square footage requirements are lower and along with that, the need for phones, computers, office supplies, architectural design and telecommunication down to the water supplier and plant service are all faced with lower sales volume.

There is no denying that, thanks to the advent of mobile technology such as smartphones, iPads and laptops, our workforce has the capability of operating anywhere from the local Starbucks to their own homes. The missing piece in this new work setup is human interaction. Mobile technology will not replace the need for humans to communicate face-to-face, eye-to-eye. Businesses will eventually realize that in order to make a successful company, an environment needs to be created that promotes working in a collaborative, personal manner rather than through the use of devices and hardware.

When Yahoo's president announced that she was calling her mobile employees back to their offices it signaled to the business world that mobile officing is not a replacement for a traditional office setup. The need to have all employees communicating and working together in a conventional office space is valid and longstanding – I hope that businesses realize that sooner rather than later.

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Written by: Hans Hansson

E-mail: hans@starboardnet.com


Hans Hansson is President of Starboard TCN Worldwide Real Estate Services as well as a member of the Board of Directors for TCN Worldwide Real Estate. Hans has been an active broker for over 28 years in the San Francisco Bay Area and specializes in office leasing and investments. If you have any questions or comments please email hans@starboardnet.com or call him at (415) 765-6897. You may also check out his website, http://www.commercialspacefinder.com/.

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