Demand for office space in the immediate future could drop by 10 to 25 per cent
Cox’s prediction raises a question plenty of other bosses and real estate experts are already pondering: how much room does a company really need anymore? And if it’s significantly less, how will that play out in the economy? Major players in the tech industry are also making their moves. Waterloo, Ont.-based software company OpenText Corp. announced a restructuring plan that will permanently reduce its number of offices by half. Twitter will let its workers work from home indefinitely. Meanwhile, Shopify founder Tobi Lütke announced on social media that most of his employees will now permanently work remotely as “office centricity is over” and his e-commerce giant is now “digital by default.
“The biggest expenses for knowledge-economy firms are payroll and then rent,” says Haider. “All of these bigger employers have had the realization that their employees can be productive from home and they’re trying to rationalize the expense of an office.” And if fewer people come to the office every day, restaurants and retailers will have less foot traffic—even if they can open to full capacity—leaving retail-building landlords wondering what they can charge when leases come up for renewal. As for condo dwellers, “the big part about living downtown is you cut out your commute,” says Roelof van Dijk, director of market analytics for Canada at CoStar.