What’s Next for the Office? CBRE’S Julie Whelan Breaks It Down

TONYA MOSLEY: That’s Julie Whelan of CBRE, the real estate and facilities management company. She leads a global team of researchers who watch the major trends that impact commercial real estate occupiers. And we’re digging into some big topics, like how our workspace is changing, both in how they’re used and how they’re designed. What kinds of spaces or amenities encourage more gathering in person? Here’s my conversation with Julie.

TONYA MOSLEY: Julie Whelan, welcome.

JULIE WHELAN: Thank you, Tonya. Thanks for having me.

TONYA MOSLEY: What a job you have. You’re constantly talking to companies globally about the changes to workplace needs and behaviors, and really how those changes impact what we call the office. What are you hearing from leaders today? What are they most concerned about?

JULIE WHELAN: If you had talked to me even a year ago, I would have said that companies were really just focused on starting the return to office. And today, that has officially started and is in full swing. The challenge is we’re in a bit of a stuck period, where the return to office has not gone as speedy as many executives would have anticipated. And so what I would say, most executives and organizations that are not happy with that state of play right now, what we’re trying to do is figure out, how do they move to get unstuck.

TONYA MOSLEY: Is there a distinction in what you’re saying geographically, or is this global?

JULIE WHELAN: Globally, certainly, there are different distinctions across the world. And even here in the U.S., there are different distinctions. So what we’re finding is that some of the Sunbelt markets that have different commute patterns, different qualities of life, different weather patterns, tend to have people in the office more regularly than some of the larger downtown metros, where commutes can be long, and employees aren’t as ready to change that and to engage with those every day. In Europe, I would say that, generally in the U.K., they are experiencing much of what we’re experiencing here in the U.S. And in continental Europe, the story can be quite varied, because what’s interesting in continental Europe is that their cities tend to be smaller and they tend to be more micro-market, like where people don’t have to always commute as much. And so it’s those cities that are actually seeing a greater return to office. And then in Asia-Pacific, it’s very interesting. In Australia, New Zealand, I would say they’re experiencing much of what the U.K. and the U.S. is experiencing. But in the Asian countries, it’s different. There is much greater return to office. In some ways, there was really never a stop to office. Sometimes they scratch their heads and can’t even equate to what we’re talking about here, but what’s really interesting in the Asian countries is that the domestic Asian firms are really operating business as usual. It’s the multinational firms that are in the Asian countries that are really following Western principles and are still trying to jumpstart their return to office also.

TONYA MOSLEY: I have also heard you say, in real estate, change really happens slowly. So in theory, your job in particular until recently, had been forecasting sort of with a long tail, so to speak, and then the world changed, of course, over the last few years. What surprises you most about the things that are significantly changing?

JULIE WHELAN: So, before the pandemic, there was a lot of discussion about changing office space to meet the new world of work that we all knew was an undercurrent and that was happening. However, very little was actually done to meet that new world because it’s expensive. It takes a lot of change management. It’s hard to change your design principles while your people are living in the space. And so, that notion has kind of jump-started where, we know that there needs to be a change to design principles—to support these new work patterns, and to make office a more palpable place to be. And so I think many organizations are moving more quickly to try to figure out how to do that.

TONYA MOSLEY: Well, what metrics or habits should companies be studying in this moment when they think about their future?

JULIE WHELAN: There are three metrics that the company should study. Number one is space utilization. When you think about space utilization, don’t think about tracking office attendance. This is really about tracking movement within your office and understanding how well the areas of your physical office location are being utilized over time, so that you can actually change it—real time—to suit the way your employees use the space. I was just in Atlanta the other day, and I was in one of our new Workplace 360 offices, and they were showing me some of their space utilization sensor tracking technology. And there were certain space types that they had put into this office that they actually weren’t sure were going to get utilized a lot. And they can tell by their space utilization sensor tracking that actually they were being utilized a lot. And so it was worthwhile to not only keep that space in that particular build but in the other builds that they do down the line. Think about putting those in because they’re so popular. Another important metric to study is commute patterns. It is generally proven, and we are seeing data that comes in all the time, that show that the shorter the employee commute is, the more likely they are to attend in-office on a more frequent basis. And that is especially true of those people that have commutes under 30 minutes. Really understanding your commute patterns and those employees that might have challenges around their particular commute is important. And then lastly, I would say, studying what employees want out of the office. So there are many people that are talking today about the fact that maybe we’re asking employees too much what they want. But I think that when it comes to what they need from the office and what they need for their function to be successful and effective in the office, we need to study that and we owe it to employees to study that.

TONYA MOSLEY: Very interesting. Space utilization, commute patterns, and then what employees want. Are you seeing any creative or innovative ways that companies are taking on any of those three points?

JULIE WHELAN: Well, we are seeing team-based, or even event-based, space for those organizations that are actually more flexible than your normal organization. So we’re seeing that a lot of organizations want their people to come in three days a week, which means that they’re not going to be able to have completely team-based space, because people are still going to need space to focus and to have privacy. But the less often you come in, the notion is that the more deliberate need you’re going to have to actually meet together when you do come in. So creating space that’s even more collaborative and hospitable in terms of services that are within that space, that meet those meeting needs, are really important in this ‘team-based or event-based’ space. And then lastly, I would say the innovative use of office space that we’re seeing is flexible office space. So when I say that, I don’t necessarily mean flexible in terms of design that can be fungible, although that’s also something, but I really mean flexible office space like co-working, which we have seen in the past. And co-working is what we can use to describe the type of space that I’m talking about. But the reality is there are so many different uses than just co-working. And I think that what we’re specifically seeing now is a lot of flexible office space that’s popping up in suburban areas outside of cities to suit the needs of people that might not want to engage in a long commute, but that do want to get out of their home to go to a distraction-free environment that gives them that boundary between work and home.

TONYA MOSLEY: Some of the things that you’re saying here sounds like it offers people choice. And we’ve also talked quite a bit about office work on this show as it relates to what people want from the office when they’re there. We’ve learned from the Microsoft Work Trend Index that, overwhelmingly, people come into the office to see and interact with other people. Over eight in 10 people would be interested in actually coming back to socialize or rebuild team bonds. I’m wondering, what does CBRE Research show about the office as a place where people can build and rebuild those relationships?

JULIE WHELAN: Our workplace strategy lead, Lenny Beaudoin, often says that the greatest amenity that the office can provide is other people, and I wholeheartedly agree with that. And we’ve all heard colleagues that say, Gee, I went into the office and I just ended up sitting on video conferencing all day. That is not something that anybody needs to do with their commute time, to go in and not feel that they’re being effective or productive when they’re in the office. There needs to be a better purpose of coming into the office, and that purpose might be seeing teammates, or it might be for others getting access to quiet space. It might be getting access to the technology that makes you even more effective, or it might be a combination of those things. But really figuring out what that purpose is is really important.

TONYA MOSLEY: How does workplace design fit into the desire for employees to go back into the workplace?

JULIE WHELAN: Workplace design matters. What we are finding is that it is not necessarily always about the design at first. The very first things are commute, the quality of the location that their office is in, and then of course, the purpose of why they have to go to the office. And then, yes, it is absolutely the office space itself. Once people have a reason to go there, they will make them happy when they’re there, they will make them engaged when they are there, and they will probably help to build the desire for them to want to be there again in the future. But it is certainly not the thing that is going to initially make people get up and out into the office.

TONYA MOSLEY: Noted. What’s interesting about what you’re saying here is that sometimes there’s a lot of emphasis on the particular office space. Open offices, we talk about those types of concepts, other types of designs, more window space. But you’re saying, essentially, employees will make the space a better place if they have a reason to actually be there.

JULIE WHELAN: Correct. The purpose cannot be underestimated.

TONYA MOSLEY: Let’s talk a little bit about technological interventions. Microsoft just introduced a new hybrid work app called Microsoft Places to help everyone understand who will be in the office and when they’ll be there, where people are sitting, and what meeting rooms to attend in person. You touched a little bit about maximizing space. How else will technology help guide people on when and why to come in?

JULIE WHELAN: Yes, that is the magic equation. And I do believe that technology is going to advance very quickly. You know, I’m very impressed with my daily interactions with the Microsoft nudges that I get. And as AI gets more sophisticated, it’s going to open up opportunities for employees to better plan their time in these central locations. And a good example is, just this morning, I came into the Boston office, which I don’t always do. And on my way in, I texted a woman that works here, and she then let me know that somebody who’s a colleague of mine from Philadelphia was going to be here. Now, there is a way that technology could have connected that, and that is going to come very soon.

TONYA MOSLEY: What grounding piece of advice do you have for office managers as they navigate all of this, and wanting to build robust teams, and having them work together in person?

JULIE WHELAN: You have to answer the question, Why? If it’s just because we want to get people back the way that it was, then that’s not enough. You have to create a purpose. This idea of purpose is extremely critical in getting people to come back to the office, because the office of the 20th century was built on purpose. It was built on needing to go in because you had people there that would dictate your work. You would have the other people there that you worked with because you weren’t having multinational companies that were working across boundaries. You had desktop computers, you had files, you had fax machines, you had servers. You had all the tools that were the necessity of being in that office. The necessity of the 21st century is not the physical office environment. It’s the digital infrastructure that backs up your work. We have to create what that new necessity is and what that new purpose is. In this time where we’re really starting to discover and understand how to verbalize what that purpose is, there are ways that we can train managers to change behaviors in the organization, and I think it’s things as simple as, what are the consistent, in-person team meeting times that we’re going to have, that we’re expected to come together, and let’s build social activities like lunches or team-building around those meetings. Let’s make sure, as I said, that everybody is updating their status on messaging platforms. Let’s set expectations around new norms and behaviors, and let’s lead by example. And so, at the end of the day, that’s the grounding message. What is your why , and how are you going to make sure that that why infiltrates its way across the organization?

TONYA MOSLEY: What you’re saying here is that managers need a new way of thinking of their role as managers.

JULIE WHELAN: Yes, and that’s the tricky part. Because the world is from this perspective, or it’s turning more into knowledge workers, the traditional way of managing through seeing headcount and seeing people at their desk is no longer valid. Just because people were at their desks and you could see them as a manager before didn’t necessarily mean that they were being effective at what they were doing. And so this idea of setting clear goals, giving people the drive to want to go accomplish those goals in an autonomous manner, but then keeping that feedback loop open to give constructive criticism on how those goals are being delivered, is ultimately the way forward.

TONYA MOSLEY: Help us envision what the office might look like a decade from now.

JULIE WHELAN: A decade from now, I hope the office isn’t even called an office anymore. I want to work to come up with a new name. I say that because if you think of all the memorable places that you have gathered in your life that you remember, they usually have a name that’s not generic. So if I think about my world, I don’t go to a baseball park, I go to Fenway. And it wasn’t the lawn in college that we gathered in, it was the quad. And for my kids, it’s not that they’re going to school, it’s that they’re going to the Sheehan. And so my point is that we should really start to think about branding our workplaces so that people have a greater sense of connection and loyalty to them. Ultimately, I hope that whatever we call this place, or even if it’s individual names for every company, that it becomes a place where people come to gain a sense of belonging, to gain the ability to learn and to share their knowledge, to bond, and to get to know each other on a really personal level. I hope that the purpose isn’t for it to be task-driven, but I hope they’re actually driven by the experiences and the opportunities that they get when they visit them.

TONYA MOSLEY: Julie Whelan, thank you so much for your time. This was great.

JULIE WHELAN: Thank you. This has been wonderful.

TONYA MOSLEY: That was Julie Whelan, global head of occupier thought leadership at CBRE. And that’s it for this episode of the WorkLab podcast from Microsoft. Check back soon for our final episode of the season, where my co-host, Elise Hu, will interview the bestselling author Daniel Pink, about what leaders can learn from their regrets. And please rate, review, and follow us wherever you listen. This helps us out a lot. If you have a question you’d like for us to pose to our leaders, just drop us an email at [email protected], and be sure to check out the WorkLab digital publication too, where you can find, among other things, a transcript of this episode. You can find it all at Microsoft.com/WorkLab. The WorkLab podcast is a place for experts to share their insights and opinions. As students of the future of work, Microsoft values inputs from a diverse set of voices. That said, the opinions and findings of our guests are their own and may not necessarily reflect Microsoft’s own research or opinions. WorkLab is produced by Microsoft with Godfrey Dadich Partners and Reasonable Volume. I’m your host, Tonya Mosley. Our correspondents are Mary Melton and Desmond Dickerson. Sharon Kallander and Matthew Duncan produced this podcast. Jessica Voelker is the WorkLab editor. All right, until next time.