How Facility Managers Can Navigate the New Landscape of Returning to the Office in 2024

Nearly four years after the COVID-19 outbreak, as companies urge employees to return to the office, a growing number of organizations are using occupancy data and employee preferences to guide workplace space decisions and building operations. According to VTS's 2024 Global Workplace Report, in December, 33% of companies in North America said they planned to encourage employees to spend more time in the office, up from six months earlier, with 25% planning to mandate more attendance. A survey by workplace management and analytics company Robin in late 2023 also found that among more than 500 facility managers and business owners, 88% planned to mandate a set number of days per week for employees to be in the office.

Hybrid work dominates workplace operations

Despite executives showing a stronger desire for return-to-office, VTS notes that the lingering effects of the pandemic and a preference for flexibility will keep hybrid work dominant in 2024. The report shows that 52% of organizations require employees to be in the office 1 to 4 days per week, while 37% require a full 5-day presence. The survey covered more than 400 corporate leaders globally.

New data shared by JLL Research with Facilities Dive shows that 68% of Fortune 100 companies have established hybrid work strategies for employees, averaging three days per week in the office, but with significant variation across industries.

The trend toward larger-scale return-to-office has begun to influence how business owners and facility managers approach their portfolios, assets, and operations. Before the pandemic, work was mostly done in the office; during the peak of the pandemic, it shifted to remote; now it is a hybrid of both.

What has driven the shift in work models over the past year? According to a survey of 549 business leaders conducted by FM:Systems in late 2023, 53.8% attributed the change in work models to management mandates, 43.9% pointed to initiatives to incentivize employees to spend more time in the office, and 28% mentioned adjustments to office layout and decor over the past year. In Robin's November 2023 office space survey, 89% of respondents said they are changing office layouts or designs to support new employee needs.

"The number one factor we see driving return-to-office behavior... is FOMO," Brian Haines, Chief Strategy Officer at FM:Systems, told Facilities Dive. "If your colleagues are in the office and you're not, you might miss out on important information." He noted that this is prompting many organizations to rethink their real estate management approach, with a greater focus on collaborative spaces.

The gap between attendance rates and space utilization

Despite corporate efforts to optimize hybrid workplaces, office utilization remains low. According to CBRE's 2023-2024 Global Workplace and Occupancy Insights Report, average office utilization in the Americas was only 31% in 2023, compared to a global average of 64% before the pandemic. Meanwhile, the report says the global average occupancy rate—the ratio of assigned people to seats—exceeded 100% for the first time, due to a 44% increase in space sharing and a 22% reduction in space per person since 2021.

Although FM:Systems, after analyzing a sample of 20 million square feet of utilization data, had Haines predict in October that global office attendance would recover to pre-pandemic levels in the second half of 2024, CBRE's more recent report shows that average office utilization continues to decline, indicating that attendance rates have plateaued.

Kastle Systems' weekly "Back to Work Barometer" measures average occupancy from Thursday to Wednesday across 10 major U.S. metropolitan areas. Its first full measurement period of 2024 (through January 10) showed average occupancy at 48.5% of pre-pandemic levels. In comparison, the first week of September 2023 was 47.3%, and the first week of September 2022 was 44%. According to the company's "Peak Day Hybrid Index"—which measures average occupancy on Tuesdays, typically the day when office occupancy peaks—the average occupancy on the busiest day of the week rose from 42.5% on January 2 (the first business day of the year) to 57.5% on January 9, before falling back to 40.2% on January 16.

Kastle Systems' weekly "Back to Work Barometer" shows that the first full measurement period of 2024 (through January 10) had an average occupancy rate of 48.5% of pre-pandemic levels.

Although companies are taking increasingly efficient measures in real estate portfolio and space planning, the combination of hybrid work models and underutilized office space has created an imbalance where tenants hold bargaining leverage, forcing building owners and operators to work harder to improve spaces, CBRE says. The report notes that this imbalance will not resolve itself unless purposeful actions such as "well-communicated policy changes" and added amenities are taken to enhance the workplace experience and attract more employees back to the office.

Further portfolio downsizing could also partially offset this imbalance, the report says, and this appears to be a common choice for many organizations. Since January 2020, 62% of CBRE clients (covering more than 5,000 buildings) have said they have reduced their office space portfolios; another 63% plan to further reduce by 2026. Globally, 43% of organizations plan to reduce their portfolio size by more than 30% over the next three years, while 20% aim to reduce office space by 10% to 30%. According to Robin's survey, 75% of respondents plan to reduce their office footprint in 2024.

"I don't want to be a commercial real estate broker right now," Haines said, predicting that about 900 million square feet of real estate in North America will come up for renewal in the coming years, as many clients signed long-term agreements and cannot flex their size until those agreements end. However, Haines noted that numerous internal and external surveys show that the number of companies indicating intent to increase their real estate footprint is nearly equal to those planning to decrease it. "So, we're not seeing a massive sell-off."

Although workplace preferences vary by industry and company, one of the most common concerns is the lack of collaborative space. In a recent VTS survey, 40% of North American respondents said that current office spaces have limited space for team meetings and brainstorming, and they hope to address this in their next space planning.

Space and operational decisions

To accurately understand how factors such as office layout, indoor air quality, and attendance patterns affect efficiency, productivity, costs, and employee well-being, corporate leaders and workplace operators are turning to technology for insights, according to FM:Systems' "State of the Workplace" report. The report found that 69% of organizations use "workplace management solutions," which can work in conjunction with workplace analytics platforms to generate actionable insights.

While hard data sources have expanded to include IoT sensors, employee Wi-Fi connections, traditional access card swipes, and desk bookings, feeding into resource information systems, building leadership must also pay attention to soft data, including how employees feel about the workplace and their relationship with coming to work, Haines said in a recent "State of the Workplace" webinar.

JLL Research emphasized the importance of aligning work styles with the nature of each company's work to ensure productivity, noting that its data shows significant differences in average attendance rates and office attendance strategies across industries. Consequently, employee experience data is becoming increasingly important in building operations and workplace management, Rob Kolar, President of JLL Work Dynamics technology division, said in an interview.

Data shared by JLL Research with Facilities Dive emphasizes the importance of aligning work styles with the nature of each company's work to ensure productivity, showing significant differences in average attendance rates and office strategies across industries.

Kolar pointed out that building operators need a more granular understanding of employee experience, expectations, and behaviors. "When employees are in the office, what are they doing? What spaces are they using? Are those spaces appropriate? Are there enough of them? Do these spaces need to change based on how people work?" he asked. "I think what people do in the office has changed significantly, so the spaces that map to those activities need to change as well."

Organizations that are able to obtain accurate workplace data now face the task of using that data to improve space utilization, streamline workplace management, and optimize building operations.

Technology companies like Eptura and Envoy offer management platforms designed to integrate workplace experience, space planning, preventive maintenance, and visitor management tools. Large industry players are also responding to these needs. For example, CBRE invested $100 million in VTS and established a partnership, enabling the real estate services giant to access tenant and operator data through a connected mobile app, which CBRE says will allow it to "understand tenant needs earlier than anyone else in the market."

JLL Work Dynamics' Kolar noted that while he has not yet seen a dramatic change in the number of amenities offered by owners and operators, tenant experience data is playing an increasingly larger role in amenity planning, with teams now able to curate events based on attendance. "When employees are in the office—say Tuesday, Wednesday, and Thursday—there might be more services offered than on Monday and Friday. Providing a lot of amenities on days when no one is there is not optimal for anyone," Kolar said.

Beyond use in amenities and other soft operational planning, this data is also playing an increasingly important role in how office operators handle building energy consumption. After acquiring FM:Systems, Johnson Controls plans to use the workplace insights provided by its software to improve building efficiency through automated controls and operational management.

"We've solved the utilization problem, or we're one of the best in the industry at it. We're now applying that data to other operations, like all other facility operations, to optimize them based on how people use the building," Haines said. "Integrating that data with building control systems, we firmly believe that autonomous building control is the future, and buildings will be able to significantly outperform their recent performance under human management."