DIRTT Reports Second Quarter 2024 Sales Fell 8% / Manhattan Offices Continue to Get More Visits / Downtown Manhattan Office Market Sees Limited Leasing Growth / D.C. Faces Record Office Vacancy Rates As Cities Race For Solutions / X To Leave San Francisco In Favor Of San Jose, Forgoing Texas / JLL's Revenue And Office Leasing Jump By Double Digits / The Landlord's Impact on Return to Office / How do you encourage people to spend more time in the office? / ‘Gone are the days of taking a phone call in the open’: why office pods are everywhere / The Switch to Eco-Friendly Office Furniture / DIRTT Unveils Major ICE® Software Update, Transforming User Experience and Project Management / and much more…


The Working Space
Monday, August 12, 2024

Industry News

DIRTT Reports Second Quarter 2024 Sales Fell 8%
DIRTT Environmental Solutions reported second quarter 2024 revenue of $41.2 million, an 8% decrease from the previous year, but gross profit increased to $15.4 million. Net income fell to $0.6 million due to a lack of prior gains on asset sales. Adjusted EBITDA improved to $3.2 million, marking the fifth consecutive quarter of positive results. The company completed a significant debenture repurchase and adopted a new shareholder rights plan. Management is focused on revenue growth across sectors, with a 20% increase in the 12-month project pipeline and expectations for 2024 revenue between $165-175 million.
DIRTT Environmental Solutions has launched a significant update to its ICE software platform, introducing ICE Manager and the Design Editor application to enhance user experience and project management. Key features include automated updates, improved project management capabilities, and support for frequent value releases, allowing for real-time collaboration and design decisions. This update positions DIRTT as a leader in industrialized construction, providing flexible and adaptable interior solutions across various sectors.
The home office furniture market is projected to grow from $3.03 billion in 2020 to $7.61 billion by 2030, driven by the remote work trend, e-commerce growth, sustainability demands, and customizable solutions. Key findings include a CAGR of 8.8% and significant growth in the plastic segment. North America leads the market, with Europe and Asia-Pacific also showing strong growth potential. Future trends indicate a focus on hybrid work models and technological integration in furniture design.
Manhattan's office sector is recovering, with June visitation reaching 77% of 2019 levels, the highest since February 2023. A+ buildings saw 91% occupancy, while Midtown had the highest demand at 81%. Total device visits increased 9% year-over-year to 15.4 million but remain down 23% from June 2019. While onsite work is not fully back to pre-Covid norms, there is a positive trend, although real estate developers must still consider concessions for office space in the post-pandemic landscape.
Lower Manhattan's office market experienced limited leasing growth in Q2 2024, with a 1% increase from Q1 but a 48% decline year-over-year. Technology led demand at 36% of leased space, while Midtown and Midtown South saw significant leasing increases. Despite stagnation in Lower Manhattan, positive absorption continued due to more office space exiting the market for residential conversions. The hospitality sector thrived, achieving a record occupancy rate of 89% and daily room rates averaging $317.06.
Washington, D.C. is experiencing record high office vacancy rates, with nearly a quarter of office spaces unoccupied, largely due to the rise of remote and hybrid work trends accelerated by the COVID-19 pandemic. In response, the city has initiated programs to convert office spaces into commercial and residential areas. While some companies are returning to traditional office setups, the overall trend indicates a significant reassessment of office space needs across major U.S. metro areas.
Social media company X will relocate its headquarters from San Francisco to San Jose, instead of moving to Texas as previously indicated by Elon Musk. CEO Linda Yaccarino announced the closure of the San Francisco office and the move to an undisclosed location in San Jose, with the engineering team operating in Palo Alto. The decision to stay in California was strategic, influenced by ongoing rental payment issues with the San Francisco landlord. Musk had previously suggested a move to Texas but has not changed SpaceX's plans to establish a presence in Brownsville.
IWG reported record revenue of $2.1 billion for the first half of 2024, reflecting a 13% increase in adjusted EBITDA and a 19% growth in room signings, indicating strong demand for flexible workspaces. The company anticipates continued growth with 154,000 open rooms and 151,000 signed but not yet opened. IWG is also considering a stock listing transition to the New York Exchange and has aligned its financial practices with U.S. standards, while reducing net debt to $768 million.
JLL reported a 12% increase in revenue for Q2 2024, driven by strong performance in workplace and project management, with total revenue reaching $5.6 billion. Global office leasing volume rose by 10%, and U.S. office leasing activity increased by 19%. However, some sectors, like Spark Technologies and investment management, saw declines. Despite challenges, improving investor sentiment suggests potential for growth in the latter half of 2024, leading to a 3% rise in JLL's stock price post-earnings call.

Workplace News

AI agents, advanced software powered by large language models, are transforming the workforce by automating tasks such as scheduling and planning. While they show potential to replace human roles in areas like customer support and software development, significant limitations remain, including reliability and the need for human oversight. Companies must consider employee reactions to AI implementation, as dissatisfaction could lead to talent loss and a lack of human knowledge for problem-solving.
Landlords can influence the return to office by adapting workspaces to combine the comforts of home with collaborative benefits. While remote work offers flexibility, it can reduce productivity and impact mental health. A hybrid model with personalized, comfortable office environments, flexible leasing, and innovative amenities is essential to attract employees back to the office.
To encourage employees to spend more time in the office, organizations should focus on eight key factors: belonging, work interactions, health and wellbeing, concentration, workstation control, environmental control, workload management, and personal time management. Key attractors include social interactions, clear work-home boundaries, and engaging with organizational culture. Addressing personal preferences, creating a sense of purpose, assessing environmental impacts, improving office technology, and understanding employee sentiments are essential strategies for making the office a more appealing option compared to remote work.

Design

Redesigned private office pods are gaining popularity as a solution to the need for privacy in open office environments, driven by the shift towards hybrid work and the pandemic's impact on work habits. Companies are increasingly adopting modular furniture and adaptive architecture to create flexible workspaces that cater to diverse employee needs. The market for office pods has expanded significantly, with manufacturers reporting substantial revenue growth, as these spaces provide essential acoustic and visual privacy. The trend reflects a broader move towards more adaptable and environmentally friendly office designs, suggesting a potential shift away from traditional construction methods.

Green / Sustainability

The shift to eco-friendly office furniture in France has been accelerated by governmental legislation, particularly the AGEC law, which mandates that 20% of public investments in office furniture must be eco-responsible. This trend has gained momentum post-COVID-19, with a growing emphasis on sustainability and corporate social responsibility. Sustainable furniture is characterized by durability and minimal environmental impact, yet perceptions of refurbished pieces are improving. The market is evolving with a focus on traceability, quality, and innovation, driven by both legislative mandates and increasing consumer awareness.

One Click LCA and U.S. Green Building Council announce commercial partnership to drive decarbonization in the construction industry
One Click LCA has partnered with the U.S. Green Building Council to promote decarbonization in the construction industry by providing USGBC members with discounted access to life-cycle assessment software, educational resources, and outreach initiatives. This collaboration aims to enhance sustainability practices, reduce carbon emissions, and support federal zero-carbon initiatives within the construction sector.

Latest Product News

Steelcase and the Frank Lloyd Wright Foundation have launched the Rockford and Galesburg Collections, which reinterpret Wright's mid-century Usonian designs into modern furniture for homes and workplaces. The Rockford Collection features accessible pieces inspired by the Laurent house, while the Galesburg Collection includes reimagined banquettes and a tuxedo-style sofa, reflecting Wright's philosophy of organic architecture and human-centric design.
The HON Company's 10500 Series is a versatile office furniture portfolio designed to enhance office environments with innovative layouts and durable materials. It offers a range of configurations, including ergonomic workstations and modular storage, aimed at maximizing productivity and comfort. The series is adaptable to various office styles and is intended to elevate both functionality and aesthetics in the workplace.
Teknion and Pearson Lloyd have launched the Cosi Laptop Table, designed to blend elegance and functionality. It features adjustable height and tilt controls, a front lip to secure laptops, and an integrated device stand, enhancing productivity and comfort for users. The design focuses on supporting posture and well-being, while its lightweight and portable nature, along with flat-pack shipping, promotes sustainability. Cosi is positioned as an accessible solution for modern workspaces.
Indiana Furniture has launched the Serenity seating collection, designed for comfort and versatility in various work environments. It features customizable options, including arm and armless models, multiple bases, and a range of upholstery choices. The collection emphasizes sustainability and is manufactured in the USA, contributing to indoor air quality certifications and sustainable building points. Indiana Furniture, established in 1905, focuses on high-quality office furnishings and customer service.
Landscape Forms has introduced the Rockford litter performance receptacle, a 45-gallon system designed for recycling, litter, and compost in public outdoor spaces. It features durable all-metal construction, side and top-opening styles, and an intuitive servicing design. The receptacle is available in a new powdercoat color palette and aims to enhance aesthetics while meeting the needs of high-traffic areas. The design includes unique lid shapes and color coding for contents, making it user-friendly for both the public and maintenance staff.
Colebrook Bosson Saunders has launched the Flo X Multi, a versatile monitor arm designed for large format and multi-screen setups, allowing easy adjustment of two or three screens simultaneously. It features side-to-side rotation and cable management to maintain a tidy workspace. The Flo X Multi enhances productivity and user experience, adding functionality to the award-winning Flo Monitor Arm Family.
Fräsch has launched the WÜD collection, featuring 36 nature-inspired hardwood grain patterns printed on acoustical PET felt, available in various color bases. This collection combines aesthetic appeal with excellent acoustical performance, making it suitable for diverse interior design projects. The WÜD collection aims to enhance spaces while mitigating noise, offering designers a new option that reflects the beauty of real wood without the ecological impact. Samples are available for order through Fräsch's website.
NanaWall has launched its Generation 4 Folding Glass Walls, a new product family that combines sleek design with superior performance for both residential and commercial use. Key features include ultra-thin profiles, customizable configurations, and advanced operation technology. The collection cons
J+J Flooring has launched the Step by Step LVT line, inspired by the elegance and durability of linen, designed for education, healthcare, corporate, and multi-family spaces. Available in an 18” x 36” plank format with 18 colorways, including neutrals and vibrant accents, it offers versatility for branding and design. The product is FloorScore certified and fully recyclable, aiming to enhance the aesthetic of various environments while providing durable flooring solutions.

Industrial Design

The Fairfield Area Library collaborated with Quinn Evans and TMC Furniture to create the Fairfield Parent + Child Carrel, addressing the needs of parents with toddlers by providing a workstation that allows privacy for adults while enabling children to play nearby. The design includes interactive play panels, sanitary materials, and features for easy cleaning, making it a popular solution among library patrons.

Trends in Commercial Projects from Around the Globe

HLW designed a new 25,000ft² headquarters for Kingfisher in London, focusing on adaptability and sustainability, achieving a 78% reduction in embodied carbon. The office features a central service core, flexible workspaces, and a variety of settings to promote collaboration and individual focus. The design emphasizes natural materials and sustainability, aligning with Kingfisher's environmental, social, and governance commitments.
LeBron James's SpringHill Company has moved to a new office space that contrasts its previous vibrant Tribeca location with a more traditional corporate tower. The redesign by Spectorgroup focuses on creating authenticity through distinct areas for each of the company's diverse creative streams, inspired by the concept of changing TV channels. The office features collaborative spaces instead of private offices, encouraging creativity and teamwork, while incorporating elements from their media projects, such as a barber shop set from their YouTube show The Shop.
The Techspence office in Calicut, designed by Artystry Designers, features a rustic theme with a monochrome palette and pops of red, creating a functional and welcoming workspace for its young staff. The open-plan layout encourages flexibility and collaboration, with private rooms and abundant natural light enhancing the environment. The design prioritizes a learning atmosphere, fostering growth for the edutech team, and has received high satisfaction from the client despite the absence of formal change management strategies.

Latest In Real Life WFH

This modern desk setup in Italy emphasizes the importance of a well-organized and practical workspace. Key components include an LG monitor, NuPhy Halo keyboard, Logitech mouse, MacBook Pro M1 Pro, and various tech accessories. The setup highlights the significance of reviews and personal preferences in selecting equipment. Tips for remote work stress the need for physical activity and maintaining a balance between work and personal life. It also mentions the use of apps like Notion and Toggl for productivity and time management.

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.

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

Calyx by Claridge Welcomes Donna Cannon as East Region Sales Manager

Calyx by Claridge, a contract furniture brand, has appointed Donna Cannon as the Regional Sales Manager for the East Region. Donna brings over 25 years of experience in strategic sales, management, and product expertise across healthcare, education, government, and commercial markets. She is recognized for her ability to develop clients for their lifetime potential, provide high-quality customer service, and commit to organizational excellence that enhances efficiency and client retention. Her strengths include creating exceptional relationships, listening carefully, being a knowledge seller, and providing smart product placement.

In her new role, Donna will focus on identifying, developing, and maintaining relationships with end-users, the A&D community, and dealers in the East Region. She will collaborate with Calyx product line representatives and work alongside Beth McGrew, VP of Sales, on various market share initiatives. Donna excels in offering knowledge-based consultative solutions that enhance client experiences and looks forward to partnering with Calyx's internal teams and representatives in this new sales journey.

Jim Cook Joins Välinge Innovation
Jim Cook has been appointed as the new business development manager for Välinge Innovation North America, bringing over 20 years of experience in the flooring industry. His role will involve educating the industry on advanced flooring technologies and enhancing product value across the supply chain.

Ware Malcomb Names Jamie Gaan Studio Manager, Architecture in Pleasanton Office
Ware Malcomb has appointed Jamie Gaan as Studio Manager, Architecture in its Pleasanton office, where he will focus on studio growth, client relationships, and business development. Gaan brings over 20 years of experience in various architectural projects and is expected to enhance the studio's design capabilities and quality assurance processes.

Ware Malcomb Announces Promotion of Kourtney Pennycook, Hire of Lauren Leyrer in Atlanta
Ware Malcomb has promoted Kourtney Pennycook to Studio Manager of Interior Architecture & Design in Atlanta and hired Lauren Leyrer as Civil Engineering Manager. Pennycook brings over ten years of experience in interior design, while Leyrer, a licensed professional engineer, has extensive experience in land development and civil engineering. Both are expected to contribute significantly to the growth and success of the Atlanta office.

Jamie Stern Announces Several New Hires and A Partnership
Jamie Stern Furniture, Carpet, Leather & Fabric has announced several new hires, including Ginger Salmon as Sales Representative for the Southeast, Allison Allen for the Pacific Northwest, Jamie Berry as Project Engineer, and Beth McArdle Sturdivant as Furniture Project Manager. The company has also partnered with MIRA Contract in the San Francisco Bay Area to promote its products to the Northern California design community.

IIDA NY Chapter Inaugurates President for 2024-2025 Term
The IIDA NY Chapter has inaugurated Christin Weaver as Chapter President for the 2024-2025 term, succeeding Alexandria Davis. Weaver aims to support emerging professionals, enhance the chapter's visibility through a website redesign, and promote excellence in interior design. She brings nearly two decades of experience and has held various leadership roles within the chapter. President-Elect Elisabeth Mejia will collaborate with Weaver on the Executive Board.

NELSON Worldwide Enhances Team with Strategic New Hires and Promotions

NELSON Worldwide has welcomed six new team members and promoted three individuals to enhance its team and advance its presence in key market sectors. The new hires and promotions are expected to strengthen NELSON's ability to innovate and meet client needs.

New Hires: Dana Boyte has joined the team as Business Development Leader, Civic & Justice. Sharon Elder has taken on the role of Project Leader, Retail. April Goshe is now the Studio Leader, Technical Director, Workplace. Ann Kimball has been appointed as Studio Leader, Retail. Gregory Lehman has joined as Design Leader, Civic & Justice. Carina Lui is the new Studio Leader, Mixed-Use.
Promotions: Anna Carlson has been promoted to Marketing Manager, Sales Marketing. Jeff Cumpson has been elevated to Senior Director, Business Development Strategy. Stephanie Rodriguez is now Marketing Manager, Sales Marketing.

Formaspace Announces Integration with CET
Formaspace has integrated its product libraries with CET, enhancing space planning and product configuration for commercial interiors. This integration allows users to access versatile lab workbenches, modular casework, and chemical-resistant surfaces directly within CET, streamlining workflows for architects and designers. Key features of CET Designer include an intuitive interface, 3D visualization, and automatic bill of materials generation. Formaspace emphasizes its commitment to customer satisfaction and innovation in providing tailored solutions for various workplace environments.

Solomon Coyle’s Fall 2024 PM Training Enrollment Now Open
Solomon Coyle is now accepting registrations for its Fall 2024 Project Management Training classes starting on October 9th and 10th, aimed at dealers aligned with Haworth, MillerKnoll, and Steelcase, as well as the broader Commercial Interiors Industry. The program focuses on margin protection, customer satisfaction, and retention, providing essential project management skills. More details can be found at their website.

Design Pool, LLC. and Graphix Unlimited to Exhibit at Healthcare Design Conference + Expo in Indianapolis
Design Pool, LLC will exhibit at the Healthcare Design Conference + Expo from October 5-8, 2024, in Indianapolis, alongside their printing partner Graphix Unlimited. They will showcase collections designed for the healthcare market, including "Light Play," which features innovative woven window film, and "Invisible Threads," which mimics embroidered cloth. Other collections include R&R, which incorporates health messages, and Swallowtail Farms, focusing on medicinal plants. Attendees can visit Booth 1332 to see samples and learn more about the offerings.
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