The pandemic has changed people’s working lives and the office market. Savills Hybrid Working Index analysed factors that impact employees and employers to see which cities could transition to hybrid working more rapidly. Most workers want to be in the office at least some of the time, and most firms want a degree of attendance to ensure mentorship for newer and younger employees and to boost creativity, collaboration and productivity. However, some roles such as banking will continue to need traditional offices for oversight and scrutiny, which can only take place in an office environment.

We have developed an index to assess the factors that may influence the future balance of office and hybrid working. We looked at employee-driven factors, such as the size of people’s homes and commute times, as well as employer-driven factors, such as the cost and efficiency of offices and workplace culture. Hybrid Working Index: Employees’ Perspectives

The key factors influencing employees in their adoption of hybrid working are the size of homes, population composition, ease of commuting, broadband connectivity, and length of lockdowns.

• Larger homes make it easier to provide dedicated space for homeworking. Locations such as Dubai and Los Angeles score highly.
• Younger populations, or those with smaller household sizes, are more likely to seek interaction and mentorship from the office environment. Cities like Mumbai, with 50% of its working-age population under 35, may see a slower shift to hybrid working.
• Longer commute times give workers a reason to prefer hybrid working. Cities like Los Angeles, New York and Mumbai might favour hybrid working because of this. Lyon, Berlin, and Amsterdam have comparatively shorter commutes (often by bike) and might find offices remain the most effective place to work.
• Broadband speeds and digital connectivity are crucial to working remotely. Faster broadband speeds could incentivise workers to pursue hybrid working as they aren’t reliant on the fast and reliable connectivity an office environment offers. Singapore leads the pack in this respect.

Hybrid Working Index: Employers’ perspectives

The cost and efficiency of offices, workplace culture, lockdown length, and the nature of office-using employment are the key factors employers look at in their adoption of hybrid working.

• Due to the pandemic, employers need to organise space differently, with a greater emphasis on larger, less populated, collaborative spaces. This could offset any shedding of space where hybrid models are adopted. Paris, London, Tokyo, and Hong Kong have higher office rents, which makes hybrid working strategies attractive.
• Shorter lease lengths could mean more agile decision making among firms and could promote a quicker change, while longer lease lengths in the US and UK could slow the transition. 
• Work cultures pre-pandemic will also play a role in the shift to hybrid working. Less flexible working cultures in Shanghai, Hong Kong, Tokyo and Ho Chi Minh City mean that any transition will be slower.
• Long lockdowns have shown that this transition is possible, but it has also highlighted that culture can be eroded if people do not have the opportunity to come together.

Troy Griffiths, Deputy Managing Director stated “Vietnam has a strong SME base and a very active start up environment. These users do not typically take formal office space and so co-working space has grown extensively. As these occupiers’ businesses mature then they will require formal office space and therefore increase demand, that may be best satisfied with hybrid models.”

What are (global) occupiers saying?

Full time office-working

Commenting about Vietnam’s market, Troy concluded “Influences of demand change quickly in a dynamic business environment, such as Vietnam. With HCMC’s recent rapid growth in FIRE and ICT industries then the formal office occupiers will continue to require highly functional and pleasing space to satisfy the young workforce. However, with a recent long lock down, and with solid growth in SMEs forecast then the traditional office models will be challenged, thereby promoting more flexible hybrid offices.”

Our Service: Commercial Leasing

Read More:

• Offices Shift to Hybrid Working 
• Office demand in a post-pandemic world