Office of the FutureApril 22, 2022
In a recent article from Costar, “a medical records software provider, with employees working remotely, says it’s got the prescription for the “office of the future.” The company is CentralReach and they signed a long-term lease for 25,000 sf, an expansion from their existing 14,000 sf offices, at the Bell Works complex in New Jersey which is located at 101 Crawfords Corner Road in Holmdel.
CentralReach’s office is “focused on space for in-person meetings and collaboration” and it’s designed to work with the “remote-first” hybrid approach.
CentralReach’s office space is said to be focused on “space for in-person meetings and collaboration when needed.” CentralReach has almost 400 workers that operate on a remote basis and they have been growing at an impressive rate over the past few years. Since 2018, CentralReach has grown their revenue by 700% and the plan is to grow to 500 employees by year end which is 400 employees increase over the past three years.
The goal was to create a space that worked in conjunction with the company’s “remote-first” hybrid approach. According to the CEO Chris Sullens, “We’re proud of our sustained growth over the years, we also came to recognize the importance of a physical space that could facilitate collaboration between all our employees, regardless of where they are working. We immediately recognized that Bell works was the right setting to turn that vision to reality, and we are incredibly excited to begin a new era of expansion at the metroburb.”
The new offices will include an open and configurable floor plan, with roughly half of the space dedicated to collaborative work. Meeting rooms and other areas of the office will have televisions and other equipment to allow seamless communication between employees present in the office and those working remotely. On the aesthetics side, the offices also feature colorful layouts, using plants and other sustainable materials.
If CentralReach has plans to grow their employee base to 500 by the end of the year, how many employees can come to the offices to work at any given day?
I looked up CentralReach’s website to see where their offices are located. They have four locations listed (Florida, New Jersey, Italy, and Ireland) but they don’t indicate the size of each office. If I assume that the Florida, Italy, and Ireland offices are just field offices and that they are 2,000 sf or less per location so with that assumption, the company would occupy a total of 31,000 sf. If CentralReach has 31,000 sf of office space that they lease world wide, how many employees can they have in their offices each day? In order to figure that out, we need to talk about the density in their offices.
Once we’ve estimated their office footprint, we can now look at density. Using traditional office parking, most office buildings are designed to have an occupancy load of 4 employees per 1,000 sf of space (or 250 sf per person). Using those densities the company would have about 124 employees working in their offices if they stick with a typical (250sf/person) parking ratio for a suburban office building. However, over recent years, I’ve seen employee density increase from 225-250 sf per person to 185 sf per person. So, if we move the density up a bit and use the density of 185 sf per person, then you could increase the occupancy load from 124 employees to 167 employees.
If this is the model of the office of the future, only lease enough space for 1/3 of your workforce then we may see office market impacted in a major way.
To put this into perspective, CentralReach is only leasing enough space for approximately 167 employees which is only about 1/3 of their work force. In other words, 2/3 of their workforce is working from home. It’s hard to know if this is actually the office of the future as it raises more questions like a model like this be enough for companies to be able to keep their culture among employees, will productivity go up or down with 2/3 of your workforce working from home, if companies only lease enough space for 1/3 of their employees, what can we expect to see for the office markets of the future?
What do you think of this model? Do you prefer to work from home or at the office? What do you think will happen in the future office market? Leave a comment below.