Most of us are working from home due to the lockdown in the wake of the COVID-19 pandemic. Also, most of the offices were closed totally due to corona pandemic - the result of which; many tenants/property landlords were at risk and April payments have also reduced due to economic shutdown. In the month of April, we have seen the demand for office space fall continuously. Post the announcement of lockdown 4.0, many things have changed. Especially the restrictions under 5 different zones (Containment, Buffer, Red, Orange and Green Zone) changed the demand for work from home so far.
In a statement, the NMDA made it clear to avail work from home as much as possible, in order to contain the spread of coronavirus and allow only 30-50 per cent employees to work form office. But, many property consultants like Knight Frank LLP, ANAROCK said the ultimate solution is not to work from home and is not that easy for the corporate.
Knight Frank LLP did a survey on “Corporate real estate executive” survey, it has been declared to clear the picture of the perceptions and expectations of industry leaders in order to understand the workplace dynamics and its impact on the corporate real estate strategies after the lockdown 4.
Shishir Baijal, Chairman and Managing Director, Knight Frank said, “The survey gives us a perspective that real estate users are unlikely to reduce their current portfolio mostly due to the norms of social distancing. Till a viable treatment for COVID-19 is found, office space users will have to maintain or acquire more space to accommodate the existing team. Work from Home will co-exist, but office space will not lose its importance as a strategic tool for corporate culture development and a source of competitive advantage.”
In the report, it is cleared that an overpowering majority of 72% said that they are likely to continue with the work from home arrangement in the next six months due to the social distancing norms and as Business
What may change after six months of period?
• This is no doubt true that people will start doing work from home rather than coming to the office. But that doesn’t mean office space will lose its importance. The reasons are many, people think that by going to the office they are more productive and can work in the discipline.
“Going forward, especially in the post-pandemic phase, more formulae will be devised which will include “Work from near Home” alongside Work from office and work from home. This will, in the long term, ensure there will be Offices developments not only be in the top 8 cities but in smaller towns where employees originate from.”- also said Baijal
• According to the survey, 35% of respondents feel that current work from home has yielded the same productivity as pre-lockdown phase
• 62% of respondents are likely either retain or increase their portfolio in the next 12 months only 15% of respondents said they are likely to reduce their current office space portfolio
• Problems due to ‘Connectivity’, ‘Distraction due to family’ and ‘Lack of supervision’ where to top three challenges of obstruct the productivity in work from home of employees
• As this is global pandemic and social distancing is important. So, 48% respondents said that more than 30% of their workforce is expected to continue working from home in the next 6 months owing to social distancing and challenges of transport
• Majority respondents also said that ‘maintaining social distancing’ and ‘physical transportation of employees’ are the two main challenges at workplace that all companies will have to find a viable solution to
• The biggest challenges for the corporate is to resumption of work from office are identified ‘physical transportation of workforce’ and ‘maintaining social distancing’
• Social distancing is very important and by keeping this in mind only 16% respondent identified ‘Convincing employees to come to work’ as a challenge towards restarting their office space operations
• Work from home has impacted the productivity level of work
• The works which can be done in 8 months are likely to be done in 12 months what experts think. There are lots of hindrances which can come while doing work from home
Key productivity hindrances in work from home
Challenges faced by the corporates due to pandemic
• More than 16 percent of the employer says that it is really difficult for the employees to come to work
• Physically a transportation service to the employees to work is needed during lockdown as borders are sealed. So, coming to office and work during this pandemic situation is not that easy
• This is the reason companies are allowing their employees to work from home as they don’t have to provide extra cost on transportation
• Best part is that maximum (more than 31 percent) numbers of people are maintaining social distancing which is a much needed step at this point of time
• But in the coming weeks to maintain social distancing company has to take extra space to maintain the distance in the office
• Have to dispense 72 percent of the office against consolidation
• The coronavirus has thrown a serious concern into the works of this money-spinning real estate segment, at least for the next two quarters
According to Ashutosh Limaye, Director & Head - Consulting, ANAROCK Property Consultants-“Work From Home is not a Catchall Alternative. For India Inc, the evolution of the WFH option is at least as exciting as that of co-working – if not more, considering its multiple benefits. That said, it will not work for every type of company
• Also, most major industries have functions which require a high level of centralized supervision as well as data security which are only available in a formal office setting. As is becoming evident in this trial by fire, video conferencing technologies have very distinct limitations, too
“Most employees depend on the infrastructure provided in their offices to do their work efficiently, and also require a formal office setting to get into ‘work mode’. While WFH is not a one-size-fits-all workplace alternative, social distancing norms are likely to remain in place for a while to come and more and more companies will need to consider this option” says Limaye.
• Work from home is not the overall solution. It can lead to many business verticals and functions still require employees to work in an office setting. A large chunk of work needs constant monitoring and professional infrastructure which only an office setting can provide. Nevertheless, market dynamics are changing quickly now
• Co-working – Co-working is likely to see subdued demand over the next few quarters, but will also see the fastest revival - the pandemic pressures will eventually ease out many businesses will look to restart in these flexible workspaces
• Co-working spaces are not only the most cost effective, but also offer flexibility in terms of time period of rental agreements. Co-working spaces can be rented on a monthly, day-to-day and even hourly basis
• Conventional Offices – Traditional office spaces are currently a source of worry for both tenants and landlords. This is because it is difficult to visualize and plan for a post-pandemic market scenario
• However, when the Government’s focus shifts back to economic growth, it will roll out business-boosting incentives that will revive the fortunes of commercial office spaces quickly and this will increase the rent of office spaces more
• What is certain is that commercial space requirements are in for a major upheaval, as India Inc will not hit a ‘business as usual’ equation for quite a long time. Tenants will recalibrate their space requirements, and the effective average monthly per-desk rentals at Grade A office spaces in some of the major business cities will be a central consideration
One the other hand Anarock property thinks Work from home has some benefits as well:
“The COVID-19 pandemic has been a major game changer, making WFH a respectable and even altruistic decision. Companies can save a lot of revenue on office space occupancy. Secondly, WFH can be a major productivity enhancer as employees save the time which they would ordinarily spend on daily commutes. Thirdly and as a derivative of the second benefit, it can significantly boost employee well being. ”adds Limaye.