Like CRE, Telecommuting Trends Depend on Location

Tuesday, February 25th, 2014

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Like CRE, Telecommuting Trends Depend on Location
Murray, MichaelTelecommuting can save companies in operational costs and increase productivity, but like commercial real estate, a telecommuting office depends on location.
“It is very likely to be variable depending on block-by-block, city-by-city,” said Gil Gordon, principal of Gil Gordon Associates, Monmouth Junction, N.J.
“We are seeing a clear reduction in the average number of square feet per employee in the office, in terms of dedicated assigned space, and the floor plan has fewer cubicles and private offices and more different types of shared spaces,” Gordon added. “The net effect of all that, if done right, is to drive down average square footage per employee, but there is still square footage.”
Gordon said telecommuting works for some offices, including smaller staffs with 20 to 40 employees.
“Some kind of a start-up operation has the luxury of doing something without the legacy space staring them in the face,” Gordon said.
JetBlue, for example, had its entire call-center operation work from home when the airline started and Gordon said “many thousands of square feet of space that did not have to be leased or built.
“By contrast, it is very unlikely that United Airlines, Delta or anyone else is going to close down all of their call centers and have millions of square feet of space come on the market,” Gordon said.
Beyond cost savings, industry analysts said telecommuting can be effective in retaining talent, increasing productivity and increase speed to market. Richard Kadzis, analyst at CoreNet Global Inc., Atlanta, Ga., said companies sitting on cash after cutting costs will now need to reinvest it into product development and core business.
“Cost cutting is under the heading of efficiency,” Kadzis said. “[Companies] can only cut so much before it has an impact on their effectiveness or ability to do business. The companies with long-term vision–Cisco, Sun Microsystems, telecommunications and technology companies