The Collective Acquires Leading Teknion Dealer Ergoworks / Hybrid Work Grows as 75% of Leaders Plan Greater Flexibility in the Next 2 Years / 18.1 Million Americans Are Now Digital Nomads / Is 2025 the Beginning of the Office Turnaround? / New Data Proves It’s Not All Doom and Gloom for the Office Market / Silicon Valley Office Campus Trades at Steep Discount / Office Market Woes Lead to Fire Sale in Chicago Loop / Index Shows 1 In 6 U.S. Office Buildings Are Strong Candidates For Residential Conversion / Rents Tick Up While Concessions Decrease For Best-In-Class Office / In Proptech, Is Out of the Office the New In the Office? / Half of workers want to find a new job in the next year / This Company Implemented A Hyper-Flexible Work Model (And It’s Actually Working) / People want the flexibility of hybrid work, but don't want to go fully remote / The Invisible Workplace / and much more…


The Working Space
Monday, September 2, 2024

Industry News

The Collective Acquires Leading Teknion Dealer Ergoworks
The Collective has acquired Ergoworks, the leading Teknion dealer in Atlantic Canada, enhancing its national presence and service capabilities across Canada. Both companies have achieved Teknion Platinum Dealer status, reflecting their commitment to exceptional service and client satisfaction. This acquisition will allow them to combine resources and expertise to offer a broader range of services while maintaining personalized client care.
 
"We are thrilled to welcome Ergoworks Atlantic to The Collective family," said Chris Rayner, President, and COO of The Collective. “This acquisition brings together two highly respected Teknion dealers, both of whom have a deep commitment to providing exceptional service to our clients. Ergoworks’ strong reputation, talented team, and deep understanding of the Atlantic Canada market make them a perfect fit.”
The office market may begin to stabilize by 2025, according to CBRE, which noted positive net absorption of 2.5 million square feet in Q2 for the first time in two years. However, further challenges and additional inventory of 33.5 million square feet expected through 2026 suggest that a complete turnaround will require more time and effort.
Despite concerns about the office market, recent data indicates signs of recovery, particularly in Manhattan and Philadelphia, with increased occupancy rates and leasing activity. The Avison Young Office Busyness Index shows many markets are busier than in 2023, and employers are pushing for a return to office work. However, the long-term impact of remote work remains significant, with a plateau in remote working days and a shift towards more on-site jobs. Overall, while challenges persist, there are positive indicators suggesting the office market may stabilize.
Less than 1 in 6 U.S. office buildings are suitable for residential conversion, with Manhattan leading at over 53%. The Conversion Feasibility Index indicates that only 2.7% of buildings are top candidates, while 12.1% have strong potential but require modifications. Despite rising conversion interest, over 85% of buildings are deemed difficult to convert, prompting some cities to offer incentives. The overall office market faces a record vacancy rate of 20.1%, with office sales down significantly since 2021.
In 2024, effective rents for Class-A and trophy office properties have increased by 2.4%, while rents for Class-B and C properties have decreased by 1.2%. Despite rising tenant improvement allowances, concessions have decreased, with Class-A and trophy properties offering 9% less and Class-B and C properties offering 8% less compared to 2023. Overall, a decline in office asking rents of 1.8% is expected by mid-2025, driven by lower-tier properties, while Class-A and trophy rents are likely to remain stable or increase.
Allstate sold a Chicago office building for just over $11 million, significantly below the $29.7 million purchase price in 2022, reflecting challenges in the commercial office market due to high interest rates and declining property values. Central Business Districts in major U.S. cities are experiencing downturns, with downtown office values falling by $557 billion from 2019 to 2023. The property was never fully occupied by Allstate, which continued operations elsewhere. The sale highlights broader struggles in the office market, with fears of mortgage defaults, while some buildings are being repurposed for coworking spaces.
A Silicon Valley office campus has been sold at a steep discount, reflecting the new normal for office valuations post-pandemic. While sellers face lower property values, buyers are optimistic about potential future gains from these previously prime locations. Each transaction is closely analyzed as a benchmark for pricing and market sentiment.

Workplace News

The proptech sector is adapting to evolving workplace strategies, with companies like Dealpath and Stuf balancing remote, hybrid, and in-office models. While Dealpath requires employees to be in the office 3-4 days a week, Stuf has embraced a distributed approach with a coworking space option. Both companies recognize the value of in-person collaboration for innovation and relationship-building, despite utilizing remote work tools. Investors support flexible policies, and some companies, like MRI Software, have developed custom programs to accommodate diverse work preferences. Although remote work offers benefits such as broader talent pools, companies acknowledge drawbacks in collaboration and professional development. Nevertheless, there's optimism in the commercial real estate sector as employees express a desire for more in-person interaction, potentially driving office space demand.
A study from the University of Nottingham highlights the psychological risks of remote work, particularly information overload and fear of missing out (FOMO), which negatively impact employees' mental health. Information overload leads to increased stress and burnout, while FOMO exacerbates anxiety about missing important updates. The study suggests organizations should streamline communication and set clear boundaries to mitigate these issues. Additionally, it points out the problem of information poverty, where lack of access to critical information can also harm employee wellbeing.
Nearly half of American workers plan to seek new jobs within the next year, with this figure rising to 64% among Generation Z. This marks a decrease from 56% in March 2023. Factors influencing this trend include high inflation and the search for better-paying jobs, with only 22% of all workers willing to relocate for employment. Additionally, 29% of workers express interest in starting their own businesses, particularly among younger generations.
The Allen Institute has successfully implemented a hyper-flexible work model that prioritizes individual and team needs, enhancing employee happiness, engagement, and retention. Challenges such as collaboration and onboarding are addressed through monthly in-office days and various social activities. The approach fosters a healthy work-life balance and aims to create an inviting workplace culture, with ongoing support and training for leaders to manage hybrid teams effectively.
A recent survey by Zoom and Reworked INSIGHTS reveals that hybrid work is the preferred model globally, enhancing productivity and employee satisfaction. 83% of employees report higher productivity in hybrid environments, while 82% feel more connected to their teams. Despite the popularity of hybrid work, 75% of leaders expect changes in working styles soon, with a focus on flexibility and the integration of generative AI, which 94% of leaders are already using. Western Europe shows the highest adoption of hybrid models, while APAC also reports increased productivity in these settings.
Younger generations, particularly Gen Z, are redefining workplace exits through trends like "resignation-as-a-service" and "loud quitting," reflecting dissatisfaction with traditional work environments. Factors such as digital communication, the COVID-19 pandemic, and changing expectations around work-life balance and employer accountability are driving these shifts. HR departments must adapt by offering flexible work arrangements, promoting ESG commitments, and fostering positive workplace cultures to attract and retain talent across generations.
Six key trends shaping the future of work include the impact of technology on workplace dynamics, the demand for flexible work schedules, the influence of global competition and demographic changes, and the need for organizations to adopt modular workspaces. The pandemic has accelerated the shift towards remote work and reduced reliance on traditional office attendance, prompting companies to align their workspace strategies with organizational goals for better efficiency and employee satisfaction.
Younger workers face challenges in career advancement as older workers postpone retirement, resulting in a crowded workforce with five generations. This generational gridlock leads to slower promotions and widening income gaps, impacting young workers' ability to afford homes and start families. Solutions include encouraging start-ups for faster career progression and allowing younger employees more responsibilities while older workers transition to mentorship roles.

Flex Space

International Workplace Group has added 200 new partnership locations in the U.S. in the first half of 2024, reflecting the growing demand for hybrid work solutions. This expansion follows a record addition of 867 centers globally in 2023 and 465 in early 2024. The majority of new locations are in suburban areas, catering to the desire for workspaces closer to home. The company continues to leverage partnerships with property owners to capitalize on the hybrid working trend, aiming to meet the evolving needs of businesses and employees.

Trends

The concept of the invisible workplace, as Steve Gale explains, is revolutionizing how we approach office design and functionality. By leveraging advanced technologies, organizations can create environments that are not only more efficient but also more responsive to the needs of their employees. This intersection of workplace strategy and cutting-edge technology is paving the way for a new era of smart, adaptive offices that can significantly enhance productivity and employee satisfaction.

Design

To enhance hybrid working environments, organizations can make modest investments in four key areas: improving furniture for comfort and collaboration, upgrading workplace technologies for seamless communication, undertaking limited renovations to enhance employee experience, and investing in amenity spaces to promote well-being. Understanding employee needs and utilizing occupancy data are crucial for effective workplace redesigns.
Niche coworking spaces are emerging as a solution to the commoditization of generic shared workspaces by focusing on specific industries and their unique needs. Success depends on creating supportive environments, understanding industry dynamics, and building strong communities. Effective business models should include diverse revenue streams and flexible pricing strategies, while also addressing potential challenges such as market limitations and economic fluctuations.
Inclusive design in workplaces aims to create equitable experiences for all users by acknowledging diverse human abilities and experiences. Key principles include involving individuals affected by design decisions, balancing competing needs, and utilizing various design elements like materials and lighting to enhance accessibility. Emphasizing the importance of diversity, inclusive design fosters a sense of belonging and improves workplace productivity and satisfaction, ultimately striving for spaces that accommodate the full spectrum of human experience.

Green / Sustainability

Smile Plastics, a UK-based company, transforms waste materials into recycled plastic sheets for commercial interiors, showcasing how discarded plastics can be repurposed into attractive, eco-friendly products. Co-founded by Rosalie McMillan and Adam Fairweather, the company focuses on sourcing high-quality raw materials and employs innovative manufacturing processes to create unique surface panels. With a commitment to sustainability, Smile Plastics aims to expand its operations and meet the growing demand for environmentally conscious materials.
Former Nike and Adidas executives are leading a $125 million redevelopment project in Portland, Oregon, to create a sustainable footwear and apparel innovation hub. The initiative aims to transform the area into a center for eco-friendly design and manufacturing, with the first phase costing $15 million and set for completion in late 2024. It will host companies focused on sustainable practices and leverage local talent to foster collaboration and economic growth in the region.

Latest Product News

Creating equitable learning environments for neurodivergent students involves recognizing diverse cognitive needs and implementing adaptable solutions. Innovations such as HON's Revel stools, Storyline bookcases, Confetti floor cushions, Tangram modular seating, and Build tables promote flexibility, sensory support, and personalized learning spaces, fostering inclusivity and collaboration while accommodating individual learning styles.
Arper has launched new extensions to the Ghia and Kata collections, featuring the Ghia 74 table and Kata Chair, both designed with sustainability in mind. The Ghia 74 table boasts a strong base and soft curves, suitable for various spaces, while the Kata Chair emphasizes natural materials and comfort, available in multiple finishes and designs. Both collections are FSC-certified, highlighting their eco-friendly design and functionality.
Herman Miller has introduced the Eames Turned Stool in a new white oak finish, expanding its collection of this iconic design first launched in 1960. The stool, versatile in function and form, can serve as a side table or decorative object and maintains the original dimensions and craftsmanship. It is available for purchase online and in stores, continuing the legacy of Charles and Ray Eames through the Eames Office.
3form Elements has launched the Acoustic Dimension Series, featuring four new acoustic panels—Stave, Tignum, Zenith, and Flute—that enhance sound dampening and design versatility. Made from 50% post-consumer recycled PET, these panels offer high NRC ratings and come in 22 colors with various textures. The series is suitable for both wall and ceiling installations, ideal for workplaces and hospitality settings, and is certified sustainable. Standard panel size is 44” x 96”, with a lead time of four weeks.
Carnegie has expanded its selection of Type II vinyl-alternative wallcoverings as part of its Conscious Collection, introducing products that are 100% PVC-free, finish-free, and PFAS-free. The new wallcoverings, including Pave, Inkwell, Noragi Stripe, and Assemblage, are designed for high-traffic environments, combining aesthetics with durability and sustainability. They are suitable for various applications and reflect Carnegie's commitment to environmentally responsible design and innovation in the commercial textile industry.
Interface, Inc. has launched two new carpet tile styles, Knitstitch™ and Breakout™, designed for large-scale commercial spaces. Knitstitch features a woven aesthetic with pops of color, while Breakout combines modern ombré detailing with a grid pattern. Both styles emphasize functionality, support occupant well-being, and align with Interface's sustainability goals, offering responsible and affordable flooring solutions.
EF Contract's latest Kinetex flooring collection, Dramatic Works, draws inspiration from light to enhance contemporary interiors. It features a textile composite flooring that combines the durability of hard surfaces with the warmth of carpet, suitable for various environments. The collection includes two tile formats that mimic natural light phenomena and offers nine colorways, including four new vibrant accent colors. Kinetex is sustainable, made from recycled materials, and boasts high performance ratings, including noise reduction and moisture resistance. It is designed for seamless integration with EF Contract's other flooring products.
RBW has launched Spool, a new pendant lighting collection designed by Kelly Harris Smith that combines sophisticated lighting with acoustic enhancement. It reduces sound reflections and disruptions while incorporating sustainable textiles made from recycled materials. Spool is available in various sizes and colors, including neutral gray and royal blue, with more colors to be introduced later this year.

Industrial Design

Chris Adamick, a Los Angeles-based industrial designer, introduces the Admix table system with Allsteel, promoting collaborative work and adaptability in post-pandemic workplaces. His design philosophy emphasizes challenging the status quo and addressing societal changes through innovative furniture solutions. The Admix collection aims to flatten hierarchies and facilitate remote participation, reflecting Adamick's belief in the deeper meaning of design in everyday life.

Trends in Commercial Projects from Around the Globe

The Engine in Cambridge, Massachusetts, embodies a postmodern interdisciplinary approach to science, fostering collaboration among diverse fields such as biology, engineering, and business. Its design includes flexible spaces for companies of varying sizes, promotes mentorship, and ensures confidentiality while encouraging interaction through strategically located shared areas. This innovative environment supports the commercialization of tough tech solutions to global challenges.
L.L.Bean's new headquarters in Freeport, Maine, designed by SMRT Architects & Engineers, transformed a 365,000 sq ft warehouse into a sustainable office that promotes collaboration and employee well-being. Key features include dynamic views of nature, a fitness center, a cafeteria, and innovative workspace designs. The project emphasizes sustainability through adaptive reuse, energy efficiency, and employee wellness initiatives, achieving significant reductions in carbon emissions and enhancing access to natural light. The design process involved extensive employee engagement and community collaboration, resulting in a modern, tech-enabled environment that reflects L.L.Bean's commitment to the outdoors.

Hendrick Sets OneDigital’s Latest Chapter in Motion with Atlanta HQ that Reflects Innovative Culture
OneDigital's new Atlanta headquarters, designed by Hendrick, reflects its innovative culture and growth as a tech company. The space fosters collaboration and community among employees, featuring flexible workspaces, breakout areas, and a welcoming design that accommodates a neurodiverse workforce. The design balances a modern, vibrant aesthetic with elements of stability, incorporating the company's branding and history throughout. This new environment positions OneDigital to better serve its clients while enhancing employee experience and engagement.

Latest In Real Life WFH

Joilson Day is a freelance web designer from Brazil with over 10 years of experience, specializing in strategic websites for entrepreneurs. His workspace includes an Acer monitor, Logitech webcam, and an articulated monitor support. He finds inspiration in showers and design websites, maintains a daily routine of waking at 7:30 AM and sleeping at 10:30 PM, and faces challenges with his monitor's compatibility in the Brazilian market.

Upcoming Industry Events

Orgatec 2024
October 22-26, 2024 | Cologne, Germany

Orgatec is the International trade fair for office and property equipment. Held in Cologne, Germany.

THE LATEST: ORGATEC 2024: taking the office of the future into new dimensions
ORGATEC 2024, taking place from October 22 to 25, will showcase the future of work with a focus on the #InspiredAugmentedOffice area, featuring augmented reality experiences and integrated office landscapes. The event will highlight trends in collaboration, smart work, and spatial computing, allowing visitors to engage with modern technologies through the zintoo: app for enhanced interaction. This trade fair aims to redefine office design and address the evolving needs of hybrid work environments.

NeoCon 2025 / DesignDays 2025
June 9-11, 2025 | Chicago, IL
 
NeoCon has served as the world’s leading platform and most important event of the year for the commercial design industry since 1969. A launch pad for innovation—NeoCon offers ideas and introductions that shape the built environment today and into the future.  Joining at the same time, in Fulton Market is DesignDays, a compatible show that now hosts more than half of the largest office furniture manufacturers. Hint: See both.

Industry Briefing

Hightower Names Sandi Ing Vice President of Sales
Hightower has appointed Sandi Ing as Vice President of Sales, bringing over 30 years of experience in the A+D industry. Based in New Jersey, she will focus on U.S. East regional sales, particularly in the New York Metro area. Her extensive background with renowned design brands positions her to drive revenue growth and enhance customer support. Ing's role is effective immediately as Hightower continues to innovate and expand its market presence.

Kansas City Executive Joins Office Revolution as Market Principal of New Kansas City Location
Office Revolution has opened a new office in Kansas City and welcomed Beth Collins as Market Principal. A U.S. Veteran and former Vice President of Sales at the Kansas City Business Journal, Beth brings extensive experience and community engagement. She is committed to enhancing workspaces and fostering collaboration, driven by her belief in the positive impact of good work environments on individuals' lives.

Join the Waitlist! Humanscale’s Iconic Freedom Chair Turns 25
Humanscale's Freedom Chair, celebrating its 25th anniversary, will launch a limited edition Freedom 25th Anniversary Signature Edition Chair, honoring its revolutionary ergonomic design. Designed by Niels Diffrient, the chair features an upholstered back and polished aluminum trim, available in premium fabric or leather. Each chair is signed and numbered, making it a collector's item. The waitlist for this exclusive edition is open, allowing customers to secure a piece of Humanscale's legacy. Shipments begin this month. Limited run of 250.

Landscape Forms Partners with Illuminate Bringing Premier Lighting Solutions to New England
Landscape Forms has partnered with Illuminate to represent its high-design LED lighting solutions across New England, enhancing offerings for clients in various sectors. Illuminate is recognized for its expertise in lighting and customer support, and this collaboration aims to foster vibrant urban environments in the region.

Innerscene is on the Scene with Record Growth and Increased Accessibility
Innerscene has experienced significant growth since establishing its North American headquarters, increasing its distribution network by 580% and introducing innovative lighting solutions like the Virtual Sun and Circadian Sky. These products aim to enhance mental well-being and productivity by mimicking natural light and providing a realistic view of the sky. Innerscene also offers an AIA-accredited CEU for architects and designers and is showcasing its products through a traveling showroom across the U.S.

IIDA NY Unveils the Ultimate Interior Design Showcase in Western New York
The 9th Annual BuffCon, hosted by the IIDA NY, will take place on September 19, 2024, in Buffalo, NY, showcasing the latest trends and innovations in interior design. The event aims to strengthen community connections among designers and industry professionals, featuring seminars, workshops, and networking opportunities. Notable vendors will present a variety of products, emphasizing flexibility and rich textures. The IIDA NY promotes collaboration and advocacy within the interior design community, supporting over 800 members.

IIDA NY Announces Designer Grant to Support Emerging Professionals
The IIDA New York Chapter has launched the IIDA NY Designer Grant to support emerging interior design professionals by offering up to ten memberships for those with less than five years of experience. The grant aims to provide financial assistance for membership and access to events, with applications open from September 1 to 30, 2024. Additionally, IIDA NY will celebrate its 30th anniversary in 2025, unveiling a new website and recognizing sponsors at events throughout the year.
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