You are probably very familiar with hybrid work.  Frankly, most of us start dozing off when we see another article about “The New Normal,” and I was hesitant to write about it.  But the changes in Sacramento are worth noting.  

Recently, I toured an organization that was downsizing from 12,000 SF to 8,000 SF, and during our tour, I was somewhat blown away by what several buildings now offer!  Some of the buildings could be considered class-A hotels.  Wanna get away?  Just go to the office!  

Landlords have adjusted to entice (and retain) tenants. Many amenities have been added or expanded, including workout facilities, tenant lounges, hotel-like services, and onsite restaurants.  In addition, large conference rooms and casual meeting spaces are much more common.  These new amenities are probably not free – most landlords will add the cost associated with these spaces by increasing the load factor to calculate the rentable square footage of the Tenant’s spaces.  They won’t increase the square footage for existing tenants, but they probably will when renewing an existing tenant’s lease or when leasing space to a new tenant.  

This is Cool!

Parking:  Many buildings have incorporated parking management systems that benefit tenants and landlords. Many companies allow employees to work at home for more days and staggered work schedules. For example, with the staggered work schedule, some employees may come in on Tuesdays and Thursdays, while others might come in on Mondays and Wednesdays. So, if you assume a company has 50 employees, but only 25 come into the office at a time, the parking systems allow the tenant to pay for only 25 parking spaces.  Each employee has a card key, and that card key can be programmed only to provide the employee access to the garage on their designated day.  This effectively increases occupancy and revenue for the landlord while the tenant saves money on parking.  A true win-win!

The concept of hybrid work is rooted in flexibility, which has become a key factor in employee satisfaction and retention. A recent survey conducted by Zoom found that ​​43% of workers believe flexible work is a basic expectation, and 70% would even consider leaving their current job for a more flexible working environment.

A departure from the rigid 9-to-5 office routine allows employees to blend remote and in-office work, providing a balance that accommodates their individual preferences and lifestyle needs. As organizations navigate this new landscape, they can harness the benefits of hybrid work to drive productivity, employee satisfaction, and overall success.  

The Good, The Bad and The Ugly:

Improved Talent Acquisition and Retention

Embracing hybrid work opens up a broader talent pool for organizations. Geographical constraints are minimized, allowing companies to attract and retain top-tier talent regardless of location.  Welcome to Candy Land.

Increased Productivity and Focus – Sometimes!  

Contrary to initial concerns about remote work hindering productivity, studies have shown that certain employees in hybrid work environments actually experience increased efficiency. 

HOWEVER:

In Sacramento, The State of California has significantly reduced its office footprint and the number of days employees must be in the office.  My fiance is a manager with an agency in the State.  I know her productivity has increased significantly – but not for the right reasons.  She works 12 hours a day and has to deal with employees who are now accustomed to working at home.  God forbid if an employee has to come in on a Friday! 

Currently, the State suggests that employees come into the office twice a week.  Also,  it is very difficult to manage employees remotely because while most employees are diligent and conscientious, some are diligently running errands or teeing it up.  And if you are a golfer, you know how many people were “working” on the golf course during the height of COVID.  

Cost Savings

Adopting a hybrid work model can lead to significant cost savings for organizations and their employees. Companies can reduce expenses related to office space, utilities, and other overhead costs while employees save on commuting and other work-related costs. 

Better Work-Life Balance – Maybe

The ability for employees to tailor their work environment to suit their individual needs contributes to higher job satisfaction and overall well-being.  But again, while the employee is happy as a clam in high tide, the employer may not be too excited wading through tidepools looking for their employees.  

The Maybe:  I know from personal experience that the isolation of working at home can significantly negatively impact the employee and their loved ones.  This can result in significant costs associated with therapy, alcohol consumption, and utility costs.

Implementing Hybrid Work Successfully

Defining the best hybrid model is the key. This includes determining which roles are eligible for hybrid work, how often employees will work remotely, and what tools and technologies will be used to support remote work. Businesses looking to capitalize on the benefits of hybrid work should consider the following in their strategic approach to hybrid work:

Communication

It is important to establish standard communication channels to keep teams connected and informed. Effective communication is key to maintaining a cohesive organization and becomes especially vital in a remote work environment.

Technology

Ensure employees have access to the necessary technology and tools for seamless collaboration. Communication platforms, project management tools, and cybersecurity measures are all essential for the success of a hybrid work model.

Flexibility 

Companies need to acknowledge and respect their teams’ diverse working styles. Providing CERTAIN employees autonomy to manage their schedules and choose their work environments fosters a culture of trust and empowerment, allowing everyone to do their best work, right?  Certain is the key phrase here because some employees are incapable of managing themselves – particularly when their employer does not have a cohesive culture.  

Office Design

There’s a growing trend toward flexible and collaborative office designs. If employees will only be in the office a few days a week, it becomes important for organizations to make the most of that time. Instead of finding an office space to accommodate a private workstation for every team member, the emphasis has shifted towards spaces catering to collaboration.

This shift can be seen in the increased demand for coworking spaces. Once considered a novelty only found in large cities, there are now over 6,000 coworking locations across the US. Companies of all sizes are exploring shared office solutions that provide flexibility, cost savings, and networking opportunities. The coworking sector has never been more successful, and despite reduced office occupancy rates, flexible workspaces remain prosperous.  In fact, IWG (Regus) just announced the opening of four new coworking spaces in the Sacramento Region.  

Building owners and developers are investing more in the amenities and experiences within office buildings. This includes wellness facilities, outdoor spaces, and technology enhancements to create an appealing environment for employees when they come to the office.

Businesses that are thriving in the hybrid work world

The traditional 9-to-5 office routine is evolving rapidly, and many companies are embracing hybrid work schedules to accommodate their employees’ changing needs and preferences. These five companies have successfully implemented hybrid work schedules, allowing employees to do their best:

Microsoft has adopted a “FlexWork” model, allowing employees to work remotely up to 50% of the time. 

Salesforce has implemented a “1-1-3” model, where employees spend one day working from the office, one day working from home, and the remaining three days are flexible. 

Amex employees in the US and UK can work remotely twice weekly. In addition, they’ve added a bonus of four weeks of the year that employees can use for remote work from anywhere they choose.  

Accenture utilizes a “Work Where You’re Comfortable” model, allowing employees to choose where they work based on the nature of their tasks. This approach empowers each employee to define what style of working actually works best for them.  

Zoom made the switch to remote work in 2020 possible for businesses across the globe, so it’s no surprise that they would maintain a remote-friendly schedule within their own company. Their hybrid work model requires employees within 50 miles of a company office to work in person at least twice weekly.

Parting Thoughts

By strategically embracing a flexible work model, companies can unlock many advantages like attracting top talent, enhancing productivity, and reducing costs. The organizations (and landlords) that embrace the principles of hybrid work are poised to thrive in the ever-evolving “New Normal.” 

While this may make a lot of sense idyllically, for Sacramento, the collateral damage associated with the State of CA not returning to work meaningfully hurts retailers, restaurants, and bars in the City’s CORE.  Thanks to the Golden 1 Arena, the Convention Center, The Safe Credit Union Community Theater, The Crocker Art Museum, The Memorial Auditorium, and other entertainment venues, Downtown is holding its own, and it’s just a matter of time before we are back to the normal we were enjoying just three and a half years ago!   

Go Kings!