Earlier this year, we set out to understand the changes in corporate real estate management around the world. Verdantix, an independent research firm, surveyed over 100 leaders in various industries. These surveys resulted in two individual studies of the states of CRE in the US and in Europe. CRE and recent circumstances around COVID-19 may have been nearly identical. Nonetheless, we discovered stark differences between the short and long term plans of the two groups.
Keep reading for a quick summary of how corporate real estate management in the US and Europe differ. You can download the complete studies below:
European CRE managers have been quicker to adapt non-assigned workspaces
Even before COVID-19, there was already a steady trend of companies in both regions stepping away from traditional assigned workplaces. As companies prepare to bring their employees back to the office, many are questioning whether each person really needs their own desk. Nonetheless, European firms have a strong lead in the race to implement non-assigned desk configurations. This includes hot-desking, activity-based workspaces, and collaboration areas. In fact, 90% of European firms are preparing to have non-assigned workplaces within the next 2 years. Conversely, only 38% of US companies are intending to make the progressive change.
US CREMs continue to prioritize traditional business initiatives
Similarly to workspace assignment, US corporate real estate managers are sticking to a traditional approach when it comes to business initiatives. Business productivity, cost management and space optimization goals are high priorities for over two-thirds of CRE managers. These goals will continue to hold the highest priority in the next five years. On the other hand, European managers are only using traditional business goals to help them navigate the pandemic. In the next 5 years, they plan to shift their efforts significantly. By 2025, the emphasis for European firms will be on employee satisfaction, wellbeing and retention, in addition to the more formal productivity.
The US far surpasses European efforts to collect workplace and real estate portfolio data
It may appear that European CRE management is ahead of the US on multiple counts. But US companies drastically outnumber European counterparts in one critical area: data collection. 80% of firms in Europe are utilizing metrics on space utilization as part of their strategy, which may seem like a high proportion. Unfortunately, it pales in comparison to the US, where 98% of large companies are tracking space utilization. This trend continues across all other metrics. Europeans score significantly lower on company revenue, collaboration, employee satisfaction and energy efficiency metrics, amongst others.
Both American and European corporate real estate management lacks budgetary sign-off
Despite having significant differences in CRE strategies for the near future, US and European corporate real estate managers are in the same boat when it comes to money. CREMs across the board have experienced an increase in responsibility over the past year. Yet, their authority to sign-off budgetary decisions has remained limited; 96% of CREMs categorized budgetary limitations as a very significant or significant challenge to achieving business initiatives.
Corporate real estate management is changing everywhere. This study shows that priorities differ across regions in accordance with cultural differences and where they started on workplace progression. Though Europe may take the lead on modernizing workspace configurations and business goals, the US has a more comprehensive approach to measuring workspace performance. Both regions are starting off their Future of Work journey from different corners. Nonetheless, both acknowledge that an important stepping stone is to have budgetary trust.