NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) today released a research report: The ‘My’ To ‘Our’ Office Space Transformation.
With baby boomers retiring from the workplace and millennials moving in, the shift in workforce demographics has forced corporations to rethink their space needs. While the me generation of baby boomers may still crave the corner office, younger workers typically prefer a more flexible work place. To accommodate both generations and work preferences, the hybrid office is becoming the new normal. Individual work areas are becoming less about corporate rank and more about functional use.
Workspaces have become smaller as technological advances and mobile devices reduced the number of workers that require a desk. Office workspace declined from 600 square feet (sf) per worker in the 1970’s, to 225 sf in 2010 and could decline to 150 sf this year. Law firms, however, have been signing new leases averaging 873 sf per attorney compared with 790 sf on existing leases.
The report also discusses how office buildings are adapting to new workforce demands, and what happens to those that do not. Co-working centers and co-sharing arrangements are also reviewed, and although they have been generally well received, do have their critics.
For those CMBS office collateral properties that are outdated or slow to adapt to the new workforce order, lost tenants and higher vacancies may result.
To view the report, please click here.
About Kroll Bond Rating Agency
KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).