Die besten Büros kommen erst noch

The best offices are yet to come

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Dagmar Hotze
Freelance journalist and video journalist

In the mid-1980s the early evening series “Büro, Büro” was a cult program on German TV. The daily work routine of German company “Lurzer KG”, a manufacturer of fitness products, was lampooned on a weekly basis. When company officer “Doctor Brokstedt” tied himself in knots dictating convoluted sentences (finish that off, would you?) and clerical assistant “Gabi Neuhammer” incidentally thwarted a case of industrial espionage, there wasn’t a dry eye in the house. 30 years later the dramas between the executive suite, reception and canteen have a delightfully antiquated feel. Neither “Herr Doktor” nor “Fräulein Gabi” would have a chance in the digital era alternating between work locations. Both of them would be hopelessly out of their depth and would long since have fled into retirement at 63.

Working 4.0 by unsplash.com

Working 4.0 by unsplash.com

But what do you do with the outdated company head office whose industrial era company hierarchy is visible even from outside? Even chief character Bernd Stromberg, from Germany’s equivalent of “The Office”, wouldn’t want to work there. Not to mention Generation Y, which in addition to a modern corporate culture also expects a contemporary work space and appealing environment.

Doing one’s daily job of work sitting in an “Old School” building from 9-to-5?
Not on your life.

The transformation of the economy and society means that project developers and property owners have a job on their hands if they want to offer the next generation of tenants appropriate premises. After all, as of now it is only digital natives who (still) have to work in offices conceived in the analog era.

Happy buildings are the next evolutionary stage

And there is no time to be lost. According to the UN Report on the World Population Situation, between now and 2050 the urban population will double from around 3 billion to more than 6 billion people. The current infrastructure will struggle to cope with this increase.

Rob Speyer, President and Co-Chief Executive Officer at Tishman Speyer in New York, got to the heart of the situation in his fiery advocacy for the development of cities worth living in at this year’s ULI Urban Leader Summit in Frankfurt/Main, when he asked the audience:

“What are we building today? Offices in which people work?
Or offices in which they want to work?”

Migration and climate change are necessitating a fundamental rethink in the planning of cities and buildings. What is more, technological progress is in the process of turning the traditional real estate world on its head. Speyer advocates thinking beyond the horizon of Green Buildings reduced to mere energy efficiency and designing “Happy Buildings” aligned with user needs and which foster a sense of community. Work, education, leisure, retail, recreation, mobility – the office building as a “cluster of possibilities”, not a solitary, single-use property. The property professional is convinced that those who do not quickly adapt to the changed parameters will have considerable problems letting offices over the next 5 to 10 years.

Risk factor old property  

Is all this just scaremongering? Not a bit of it. As long as 1½ years ago, Dr. Thomas Beyerle investigated the paradigm shift in office use in Germany and vividly described the influence new working worlds are having on offices. American tech giants’ work places illustrate what the future is about: it’s about community and collaboration, invariably coupled with a resource-friendly lifestyle. A brilliant example of this is the “Salesforces Tower” in San Francisco, currently taking shape in the vicinity of the newly redeveloped Transbay Transit Area. With a price tag of around 1 billion US dollars, project developers Hines and Boston Properties are building the 326 meter high, 127,000 square meter landmark building, which from 2018 onwards will be the international headquarters of the provider of cloud computing solutions.

 

Salesforce Tower by Michael Cotè

Salesforce Tower by Michael Cotè

The digital free wheeler is spoilt for choice as to where and how he would like to work between open-space offices, lounges, restaurants, cafeterias and small interior garden spread over 61 stories. If someone wishes to relax outside the building, he can do so in the adjoining 20,000 square meters of parkland or else avail himself of the numerous local amenities. And all that directly right in the city, with outstanding transport links.

In future the daily work routine will no longer comprise travel to work, do an 8 hour job and back home, but will be more fluid.

The previous separation between work, family, friends and leisure is breaking down. Companies wishing to hold their own in the competition for the best brains need to come up with something. For example, the situational use of space the “Salesforce Tower” offers would simply not be possible in a conventional office building with rigid floor plans based on the 20th century’s hierarchical working principles. Those who cling onto and persist with the old office and working world are risking their company’s success.

The office as ecosystem  

In Germany as well Internet companies are beginning to influence office building design. Offering floorspace in a glitzy Green Building has long since not been sufficient inducement for a dot-com company to sign a lease agreement. They prefer to occupy a former factory building where it is relatively easy to create comfortable large offices with chill out zones and communal kitchen. BEOS AG is currently in the process of renovating just such a “transformation property” in Berlin. The complete concept for the “Zeughof” with its 48,500 square meters of space – on the old Deutschen Telephonwerke (DeTeWe) site – in Kreuzberg’s Wrangelkiez district, should be ready by mid-2016. According to a bulwiengesa study, the building is already one of the creative industry’s top addresses.

 

Berlin Panorama by Magnus Hagdorn

Berlin Panorama by Magnus Hagdorn

Speaking about Berlin. According to the CBRE, 40 per cent of office lets in the German capital in Q1 2015 were accounted for by creative digital companies and bulwiengesa is reckoning on approximately 80,000 employees in this sector by 2020. Namely high time to tee up office buildings for techies. Also internationally known is the “Factory Berlin”, formerly a brewery in the Mitte district, where established global players and start-ups alike have settled. Here among others Soundcloud, Twitter, Uber, Lufthansa Innovation Lab, Edition F and dataArtisans are busy at work on the digital future. The branch office is much sought-after because the building fosters informal dialog and collaboration. Yet another hotspot is emerging with the revitalized, former GSW office tower in Kreuzberg, which stock market-listed Rocket Internet SE with around 2000 employees will be moving into come the end of 2016.

Digital world of work breaking down ossified structures   

In its own way, the Old Economy is busy trying out variable working models. Adidas offers different concepts and solutions depending on the target group. At BMW, all staffers – inasmuch as their role permits – are able to choose between office, home office and mobile working. Munich Re as well offers this combination by arrangement. And at SAP employees can also save up their vacation entitlement for a sabbatical.

Die besten Büros kommen erst noch

The best offices are yet to come

To maintain the team spirit, notwithstanding the physical separation from the corporate head office, every so often people meet in the inspiring environment of a co-working space, which are shooting up in the cities like mushrooms. Design Offices in particular has targeted the successful clientèle with its concept throughout Germany. Many Dax companies are now collaborating with start-up companies on innovative projects to seek inspiration and avoid missing the boat.

Property management beyond 08/15

The focus on just one type of use is increasingly proving to be an outmoded strategy not just as far as building design is concerned. Property management as well needs a complete overhaul if it is to measure up to the changed situation: from tenant communication to management, everything needs to be subjected to close scrutiny. Although managing a pure-play office building is currently still relatively simple it will become increasingly risky the further the transformation of the office working world progresses.

The fact that processes are undergoing serious change can be seen from the shorter lease terms. A five year year lease term, let alone ten years, is already more the exception than the rule. Adapting to tenants’ needs in the digital era will be the touchstone for agile and thus sustainable property management.

But how are the many, frequently still gray box-like buildings to be managed if everything and everyone is becoming ever more digital, mobile and flexible? What do you do with them? Who needs them? Who wants them? Instead beyond the run of the mill offices how do you manage innovation-friendly hubs that promote collaboration between the tenants?

 

Anyone in 2015 who still considers customer communication via the Internet or social networks to be pointless kid’s stuff should consider early retirement.

Or which services not previously offered might possibly also be offered to improve the (dwindling?) yield or margin? Is there a partner network to match already in place to achieve this? Anyone who thinks that updating the ERP system is all it takes is a long way short of the mark. These are all challenges for which the real estate manager needs to find up-to-date solutions as quickly as possible. Perhaps the digital economy’s modus operandi will help with the restructuring: more collaboration and communication and less top-down and ad hoc.

It’s certainly worth a go – because there’s no way back to the comfort zone anyway.

 

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