Steelcase lands partnership with leading esports organization  / Ethnicraft invests $18 million in new High Point headquarters, warehouse / Haworth Launches DesignLab, Future-Focused Concepts for the Office Space / Banana Republic Wants to Outfit Your Home, Too / Office space shrink is good for used furniture dealers / Offices Overtake Malls as Most Distressed Real Estate / Most Federal Agencies Are Using Less Than 25% of Their Office Space / Class A Office Values Are 35% Down From Pre-Pandemic Peak / Midweek Manhattan Office Visits At 70% Of Pre-Pandemic Levels / People Have Choice in the Workplace, But Not the Choices They Need / Return to Office: If You Build It, They Will Come / and much more…


The Working Space
Monday, July 24, 2023

Industry News

Office furniture leader, Steelcase, has partnered with Luminosity Gaming, one of the world's biggest esports teams. The collaboration will feature content creators, players, and coaches from Luminosity, showcasing how Steelcase chairs can enhance gameplay. Fans can expect to see players sitting in Steelcase chairs, community giveaways, sponsored livestreams, and social media takeovers with Luminosity players. This partnership addresses a major pain point for gamers: the physical strain that can arise from prolonged sitting and technology usage. As the gaming industry continues to grow, more furniture companies are dedicating items to the segment, including Ikea, MillerKnoll, Lovesac, Haworth, Steelcase, and Humanscale.
Belgium-based furniture supplier Ethnicraft plans to invest $18 million for a new building in High Point, serving as the company's headquarters and providing a full-scale showroom, office, and warehouse. The new 160,000-square-foot space will create 25 jobs in High Point and allow the company to keep a healthy level of stock and ship quickly to better serve its US customers. The new building will be located in the Gallimore Industrial Center, and construction will begin soon with a planned opening in 2024. Ethnicraft received $127,949 in incentives for the project, which will retain 43 existing positions and add 25 new ones. The company makes contemporary upholstery and case goods for the residential market, and entered the North American market six years ago, employing over 50 people in the city.
Haworth headquarters serves as a "living lab" where design and research come together to apply findings from workplace research to spaces at HQ. The recent renovation of the Marketing department incorporates the 5 themes that will shape the Future of the Office: immersive technology, more collaboration, focus to restore, space shift, and more human. The new space includes virtual collaboration technology, open collaborative settings, spaces for focus and relaxation, a variety of environments, and improvements to well-being in the workplace.
Haworth DesignLab has launched a new initiative to explore future-focused concepts for office spaces. The initiative includes a range of innovative designs, such as the Polaris Outdoor Collection, the Phil Lounge, the Cloud Daybed, Split-1, and the Inter-Dimension rug installation. Each design is unique and offers a playful, yet practical solution to the challenges of modern office spaces.
Mason Awtry, CEO of Wurkwel, a Chicago office services firm, says that decommissioning jobs have doubled during the COVID pandemic. Wurkwel's Office Furniture Center unit will break down the workspaces of 22,000 office workers, in 4.5 million square feet, by the end of the year. Used furniture dealers find this profitable because they can quickly find a home for their inventory after decommissioning. BOS Holdings, which operates Affordable Office Interiors, is also a new-furniture dealer and has diversified so it can make money in different economic times. The market hasn't come to a standstill, and companies are downsizing while also updating their offices to attract employees. Used furniture coming out of offices is often less than 10 years old and is still in good condition. Companies are looking to reuse and repurpose furniture rather than discard it. Dealers sell the furniture to clients or wholesalers, remanufacture, repair, repaint, or reupholster it, sell it to universities, government offices, or donate it to nonprofit organizations. The rest is broken down for scrap metal and wood. Showrooms are open to the public, and there are deals to be had.
According to the Real Estate Board of New York (REBNY), a full recovery of the office market is not defined as 100% occupancy. The REBNY analysis found that office employee workplace visits average 68% compared to 2019 data on mid-week days, 56% on Mondays, and 37% on Fridays. The report also questions how many people are working in the office on any given day and what else they are doing at the office building if they are not working in the office.
Distress in U.S. commercial real estate rose to $71.8B as of midyear, with office assets representing more than 80% of all distress. The total amount of distress increased by just over $8B from the first quarter, and potential distress is up as well, hitting $162B. CRE deal volume nationwide dropped 63% YoY in Q2, and CRE prices are falling as well.
A new report from GAO has found that 17 of the federal government's 24 agency buildings are currently using only 25% of their capacity, with agencies using an estimated 39 to 49% of the capacity of their headquarters on average. The lack of consistent standards for how agencies should measure utilization or what is considered full utilization for the approximate 511 million square feet of federal office space has made maximizing space challenging and has deterred action. The pandemic and remote work have exacerbated the situation, with agency officials questioning how to measure utilization in a high telework environment. The report also noted that underutilized office space has financial and environmental costs.
Moody's Analytics predicts that delinquencies will rise and values will fall for "obsolete" office properties, with June seeing an additional balance of $485 million of newly delinquent CMBS loans, 61% of which came from office properties. Moody's posits that the concentration of newly delinquent loans in major metro areas could be due to the concentration of office properties, in particular B and C Class, and warns that even Class A office is no longer a safe haven, putting more operational pressure on owners.
According to a recent analysis by Green Street, Class-A office values are down by 35% since pre-pandemic highs, with B-Class properties down even more. However, with transaction volumes being far off from normal, there is little price discovery and open debate over how far office values have fallen and the distance left to plunge. Public markets have priced in a "substantially more onerous decline in office values" with an implied cap rate in the 9% range based on gross asset values (GAVs), but it remains to be seen how much further office values will decline.
As more companies switch to remote work, empty office buildings are becoming a fixture in many cities. Converting these spaces to residential buildings is possible, but would require considerations such as zoning codes, real estate values, and structural issues. Building owners would need to add or move walls to create individual apartments, revise internet, telephone, and cable systems, and add more fire alarm devices. While it would not require major structural changes, it would be expensive and time-consuming.
According to new data from the Real Estate Board of New York and Placer.ai, same-day visits to Manhattan offices on select weekdays were up to 73% of their 2019 levels during the first five months of 2021, indicating a slow but steady increase in in-person work. Midweek visitations stand at 68% of 2019 levels, while Mondays and Fridays have lower visit rates. However, despite increased occupancy, the office market has not yet recovered, with office availability hitting a new high in Q2 2021 and rising 79% since March 2020.
According to Colliers, just over 66% of office space under construction in the top 15 US office markets is in urban areas, indicating a shift in demand from suburban to urban space. The report also notes a slowdown in overall office construction, with 43.2M SF under construction at the end of Q2 2023 compared to 50.1M SF in the same period last year. Tech companies account for 38% of pre-leased office space under construction, while finance, insurance, and real estate companies will take 27.3%.
The extensive survey by the Government Accountability Office found that federal offices are mostly empty, depressing the market for commodities such as office furniture and supplies. The decline in demand has a socioeconomic impact on small businesses and AbilityOne program providers. The trend towards professional services and the rise of IDIQ contracts are changing the federal market. Contractors must be aware of the two-pronged compliance battlefront for contractors, including dealing with the Justice Department's procurement collusion strike force and whistleblowers.
Despite the pandemic's impact on the office leasing sector, JLL's recent chart of the week shows that gross office leasing activity improved in Q2 2021, with the fastest growth rate since Q2 2019. Flight to quality has been a dominant trend, with tenants upgrading to higher-end space, and large-scale transactions have started to bounce back. While net absorption is still negative, it has decelerated, and the pace of sublease vacancy additions has slowed. Although not all growth was equal, with some markets declining, JLL expects vacancy rates in the US to peak over the next 12-24 months and then improve, with a significant decrease in new supply delivering to the market in 2-3 years.
According to a new report by MSCI Real Assets, around $24.8 billion of office buildings in the U.S. were in financial distress by the end of Q2 2023, surpassing both retail and hotels. The measure of offices in distress was up by 36% since Q1, as remote work continues to force companies to cut back their real-estate footprints. Meanwhile, the country’s overall office-vacancy rate is at 20%.

Features

Having too many choices is not always a good thing. Imagine needing a specific outfit for a special occasion, but after visiting several stores and browsing numerous websites, you still can't find what you're looking for. Similarly, employers are providing different choices in the workplace, but these choices may not be what workers want. In fact, recent research by Gensler shows that choice in the workplace is at an all-time high, with 72% of workers in the US and 73% worldwide having choice in where they work within their workplace. Providing access to spaces for individual work, creative group work, reflection and restoration, and connection and recharge is important for a high-performing workplace. Companies that provide both an effective space and a great experience are more likely to be located in amenity-rich neighborhoods. The new workplace ecosystem includes coffee shops, restaurants, libraries, parks, and other third spaces, and more than 80% of workplaces have food amenities on-site or nearby. Providing access to these spaces is important for employees to embrace a hybrid future of work and ultimately for better business performance.

Workspace News

Dating app fatigue and the pandemic have led some young singles to look for romance in the office. While workplace relationships can be exciting, employers and employees should be aware of potential issues such as power imbalances, favoritism, and harassment. Employers should communicate their policies on workplace romances to avoid any misunderstandings or resentment from coworkers.
While office occupancy rates are rising globally, the United States lags behind many other countries due to factors such as continued remote work policies and workers' opposition to returning to the office. Tracking occupancy rates through badge swipes and cell phone data, as well as efforts to encourage in-person attendance, are being used to understand the issue. However, cultural factors and nuances in specific cities and regions make it difficult to generalize the data. The real estate industry is working to understand what's holding the US back compared to the rest of the world and to find ways to increase office attendance.
In a NeoCon virtual session, workplace experts discussed data, trends, and design decisions that may encourage workers to return to the office. Gensler's workplace research identified five work modes, with a doubling of learning and socializing categories. The top reason for returning to the office shifted from socializing to focus on work, and respondents reported spending only 51% of their workweek in the office. Designers need to provide access to private and quiet spaces to support concentration, and affordances can help people feel part of the culture and community. Flexible spaces and technology to support collaboration with remote colleagues are key to accelerating the return.
As offices mandate a return to work, some people are super commuting by plane or train across states to get to work. These super commuters are primarily Gen Z or millennials, and they're making the trek for financial reasons. The rise of remote and hybrid arrangements during the pandemic and lasting demand from job seekers for those roles is making people less willing to move for their jobs. The share of workers relocating for jobs fell to a record low in the first quarter of this year.
The Employment Relations (Flexible Working) Bill in the U.K. has passed through the House of Lords and is set to become law, granting employees the right to request flexible working arrangements from their first day on the job. The bill removes the current 26-week qualifying period and increases the number of requests an employee can make within a 12-month period from one to two. Employers are required to respond to requests within two months and consult with employees before rejecting a request. The U.K. government believes that greater flexibility over where, when, and how people work will lead to happier employees and more productive businesses.

Trends

DB55 in Amsterdam represents a shift in what a workspace can be, with a lively restaurant space, plush meeting cabins, a health club, and a material library. The building is designed to be agile and adaptable, with a focus on blending space and encouraging co-working and spontaneous meetings. D/DOCK's founders believe that the periphery is a powerful place, and that the office should be somewhere connected to nature and designed in a circular way. They also believe that work should be an element of the full-life experience of community. The office can be a way to help other people and fill gaps in areas that are lacking.
As climate change brings more extreme weather conditions, workplaces need to prepare to safeguard employees. This includes creating a place of refuge with reliable cooling systems and air quality, conducting a climate change readiness assessment, being grid responsive, improving air quality, and bringing the outside inside with natural sunlight and plants. Employers can leverage these efforts to incentivize employees to return to the office and provide a sanctuary during transportation disruptions.

Coworking

Quest Workspaces is offering a free chance to work in the Barbie Dream Office in downtown Miami until August 31. The space features "resimercial" design elements inspired by the famous doll, and will be available for rent by the month for a fee from September 1. Last year, demand for coworking space in Miami was higher than ever, with 48% more leasing activity than the average pre-pandemic year, and coworking companies are flocking to downtown Miami where 59% of Miami-Dade County's flex spaces are.

Design

Designing empathetic workplaces is crucial for promoting well-being, engagement, purpose, and belonging. Empathy should be demonstrated in the design process itself, and the goal should be to create experiences that embrace employees’ full range of emotional, psychological, and physical needs. This includes acknowledging emotions like fear and sadness and not just designing with happy moments in mind. Empathy is also essential for designing spaces that incorporate our knowledge of sensation, perception, learning, memory, decision-making, and processing of new experiences. Furthermore, empathy is required at all scales, from buildings to cities, and is a required trait of healthy workplaces and communities that is to be sustained over time in both the culture and physical fabric of a place.
Designing for neurodiversity in the workplace involves creating environments that support a wide range of physical abilities and neurodiverse individuals. By recognizing the different needs of the neurodiverse, workplaces can provide spaces that spark creativity and productivity, such as natural and flexible spaces that offer a variety of choices, and simple wayfinding strategies. Providing an inclusive culture that recognizes different needs and environments can support and nurture neurodiverse individuals, who can play a valuable role for companies with traits such as hyperfocus, complex nonlinear thinking, pattern recognition, attention to detail, sensory sensitivity, and high energy.
Designing inclusive workplaces that support the spatial and sensory needs of neurodivergent individuals can create a more diverse, innovative, and productive work culture. Providing flexible spaces, sensory rooms, and clear spatial indications can help regulate sensory sensitivities and alleviate anxiety for neurodivergent individuals. Designers have a moral imperative to create adaptive inclusive workplaces that support everyone, regardless of their neurodivergent status.

AI

A new home furnishings artificial intelligence developed by Taiwanese company Homee AI can scan a room in 3D and generate a new image with furniture that fits the room's dimensions and layout. The AI can also recommend furniture based on a user's design wishes and room dimensions. Furniture companies can subscribe to the AI and incorporate it into their own apps, allowing users to redesign their rooms using only that company's furniture and purchase the recommended furniture through the app. The service will launch in the US in November on a subscription basis.

Technology

Free Web-based tool for Manufacturer Product Data Creation
KiSP, Inc. has launched Entity, a free web-based tool for Manufacturer Product Data Creation. The tool allows manufacturers to build and manage product data themselves or with third-party service providers, and easily export it to leading industry applications. Good product data, particularly 3D data, has become a strategic asset for manufacturers and can be leveraged across various sales and marketing channels, including online marketplaces, virtual and augmented reality platforms, and upcoming AI applications.

Latest Products

Allseating has launched Attune, a futuristic task chair that adapts to the user's body while remaining durable and resistant to impact and flex fatigue. Attune's design features cutouts to reduce pressure and increase breathability, and the connective strands within the chair release tension to create a robust support system that conforms to each user's body. Attune is available in two frame finishes and can be customized with seat and back accents in various colors. It is also LEVEL®3 certified for sustainability.
Arcadia's Laris Lounge chair combines traditional design elements with modern flair, featuring a statement-making exposed wood frame and generous, suspension-supported cushions. Versatile enough for hospitality, commercial, and educational environments, the chair also offers a clean-out feature for healthcare settings. Designed by David Dahl, the chair's universally appealing design language delivers comfort for collaborative work sessions or lounging with friends.
3form has launched the Ivory Flora Collection, a new take on biophilia featuring a neutral all-white palette of botanicals that celebrate the texture, detail, and scale of materials found in nature. The collection includes three variations of scale and the option to leverage 3form’s color system, giving designers the creative freedom of a blank canvas. The Ivory Flora Collection is available in 3form's Varia material platform and has certifications in Optimized EPD, Greenguard Gold, Type III EPD, and a Red List Free Declare Label.
AMQ Solutions expands its Amobi Team family with Amobi Team Digital Display, a mobile cart and wall that supports content sharing and collaboration in dynamic work environments. The furniture is flexible and agile, and the new digital display option features VESA mounting, support for Logitech Rally Bar, cable management, and locking storage.
Industrial designer and mechanical engineer Cameron Smith has designed the Crisscross Chair, a folding chair that emphasizes style, quality, and comfort. The chair features a geared mechanism that creates a synchronized motion with the seat and legs when folded, allowing the entire chair to nest within the front legs for easy relocation or storage. The Crisscross Chair is available for order from Smith's FurnitureSmith brand.
Demarc's HQ is a fully functioning standalone unit that offers all the essential features of a traditional home office without compromising on space or style. The HQ encourages you to create an office space that not only meets your professional needs but also fades into the background once the workday is over. The built-in and adjustable monitor attachment ensures optimal viewing angles for maximum comfort and productivity. Currently available in Oatmeal and Charcoal for $2,375 at demarc.space.
Spacestor introduces curved variations to their Palisades II range, providing designers with a flexible and elegant solution to redefine space without the limitations of physical walls. The Palisades II range offers a multitude of space types, catering to the functional needs of any workspace, while accessories like archways, curtains, and biophilic elements introduce soft lines and acoustic protection. Inspired by mid-century modernist Californian designer Muriel Coleman, the Palisades II range combines aesthetic appeal with practicality, reflecting the evolving needs of modern organizations.

InviAir Introduces Linear Diffusers: Seamless Appearance with Innovative Frameless Design
InviAir has introduced a new Linear Diffuser that blends seamlessly into any ceiling or wall for a clean, modern look. The diffuser is made of an innovative composite material that reduces condensation and eliminates cracks, while also absorbing sound to reduce ambient noise levels. It is available with 1 or 2 slots, with a 90° or 45° opening, and can be customized to fit any space.

Other News

Barbie's Dreamhouse has been an inspiration for many interior designers, allowing them to explore their creativity and passion for homes. The flexibility of the dollhouse allowed for endless possibilities in design and layout. The Dreamhouse also helped shape views on what a home could be, and even taught valuable skills around construction and expansion. Former owners agree that the upcoming Barbie movie will have an empowering, maximalist impact on design today.
Real estate in the Bay Area is expensive, but a converted office-to-residential property in San Rafael, California has recently gained attention for blurring the line between office and home life. Priced at $520,000, the one-bedroom, one-bath unit is over 1,000 sq ft and comes with an in-unit laundry and access to a shared outdoor deck. However, the conversion seems to have been done poorly, with industrial carpeting and a conference-room feel in the bedroom. The property is also located in a strip mall and the shower was not well-placed. Commenters on the property's listing found humor in the situation, while others found it depressing that affordable housing is lacking in the area.

Trends in Commercial Projects from Around the Globe

2LG Studio has renovated an Edwardian house in southeast London, preserving ornate corniced ceilings and using playful elements to balance a more serious aesthetic. The studio painted the ceilings, mouldings and upper walls in pastel colours, and used a range of references for the interior, from 1980s colours to Italian design elements such as marble and Murano glass lighting. Bespoke joinery includes a playhouse on stilts in one of the kids' rooms, while recycled materials provide textural interest throughout the house.
NELSON Worldwide transformed the Sovos Minneapolis office into a modern, hospitality-forward environment for its growing team. The office features flexible solutions to accommodate individual and team work preferences, including agile meeting rooms, mobile furniture, and hoteling offices and workstations, and impromptu collaboration zones dispersed throughout the office. The space also incorporates unique, localized art and graphics and a sleek and neutral architectural palette infused with hospitality, offering a raised gaming and lounge platform that immediately welcomes guests into a relaxed, collaborative atmosphere.
OnOffice presents six innovative and beautiful garden offices for those looking for a comfortable long-term workspace at home. The designs include prefabricated Corten steel cabins, cork-clad pods, a rehearsal room designed for an opera singer, a larch studio with mid-century utilitarian and modernist architecture, a cabin with a faceted, jewel-like form, and a mirror-clad home office that disappears into its surroundings.

Upcoming Industry Events

NeoCon 2024
June 10-12, 2024 | 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.  

Clerkenwell Design Week 2024
May 21-23, 2024 | London

Clerkenwell is home to more creative businesses and architects per square mile than anywhere else on the planet, making it truly one of the most important design hubs in the world. To celebrate this rich and diverse community, Clerkenwell Design Week has created a showcase of leading UK and international brands and companies presented in a series of showroom events, exhibitions and special installations that take place across the area.

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

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

Industry Briefing

Allsteel Welcomes Kina Ingersoll as National A&D Director
Allsteel has appointed Kina Ingersoll as the new National A&D Director to manage the company’s strategic initiatives targeting the architecture and design community, focusing on strengthening relationships and driving growth. Ingersoll brings 25 years of experience to Allsteel, with an impressive background in interior architecture, furniture design, and strategic sales planning. She aims to build a national strategy that incorporates programming to support cities and regions with their individual market needs.

Turf Expands Global Sales Team
Chicago-based acoustic solutions company Turf has expanded its sales team with the promotions of Camille Zanona to Vice President of Sales and the hiring of Katrina Gatuz as Regional Sales Manager for the West Coast, and Jamie Gray as Director of Sales for Europe, the Middle East, and Africa. With the expansion of the sales team, Turf aims to continue its success and innovation within the design world.

Nook adds representation in Arizona, Nevada, New Mexico
Nook has added Advanced Interior Concepts as representatives for their Arizona, Nevada, and New Mexico markets. The deal was sealed with a private tour of the Allegiant Stadium, home of the Las Vegas Raiders, where Nooks are being used to provide a sanctuary space during events. 

Designtex Continues to combat Carbon Emissions through a New Project in Uganda
Designtex is supporting a methane avoidance and fuel switching project in Uganda that will deliver 10,000 biodigester and cookstove systems to small-scale farmers, helping to expand the role of biogas technology in the region and reduce carbon emissions from wood burning. The project provides tools for longer-term climate solutions and brings healthful benefits to the farmers. The biogas displaces the wood fuel that families formerly relied on for cooking, which had caused respiratory issues, GHG emissions, and deforestation.

Landscape Forms Actualizes Powerful and Optimistic Roundtable on Women in Landscape Architecture
Landscape Forms hosted a roundtable at Harvard Graduate School of Design which brought together 14 female leaders and three female students to discuss critical issues and future prospects for women in landscape architecture. The discussion focused on structural and cultural issues facing women in landscape architecture with the goal of identifying ways in which they can be supported and empowered. According to the VELA Project, while women earn 55% of the degrees in landscape architecture, just 27% of licensed landscape architects are women and only 12% rise to leadership positions in the profession. A whitepaper documenting the discussion will be published by Landscape Forms and made available online.
DIRTT and Built Interior Construction have secured $2M USD in construction projects with major clients in St. Louis, Missouri, highlighting client confidence in DIRTT's innovative construction solutions. The projects include a top-tier office space, a community-based incubator, and a new headquarters for a bank, all utilizing DIRTT's adaptable interior solutions.
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