Nearly 40% of office occupiers are mandating a hybrid work model, requiring employees to be in the office 2-3 days per week, according to a new report from Cushman & Wakefield.
This comes as 1 in 8 tenants plans to expand their current office space, signaling a shift in real estate strategies.
The report, based on a global survey, indicates an easing of portfolio contraction, with only 32% of companies planning further reductions in office footprint, a significant drop from the two-thirds that downsized in the past two years.
Mădălina Cojocaru, Partner Office Agency at Cushman & Wakefield Echinox, said: "Cost pressure is the direct result of the growing competition for high-quality, yet easily accessible office spaces. Location remains essential: tenants seek buildings near major transportation hubs which offer a generous number of parking spaces. Moreover, the buildings’ surroundings are becoming increasingly important, as the nearby services must be well-clustered and integrated into a clear commercial concept which brings value to both employees and visitors."
This suggests a move from reactive downsizing to proactive portfolio management. Average office lease sizes have grown by 13% in the last two years, with occupancy levels stabilizing at 51-60%.
Cost remains the primary driver for real estate decisions globally, with financial metrics becoming the cornerstone of these strategies.
However, uncertainty stemming from political and economic instability, evolving workplace behaviors, and challenges in forecasting ROI also significantly impact confidence.
In Romania, the relatively young office stock offers a competitive advantage for sustainable investments due to lower modernization costs.
Tenants are increasingly seeking more than just quality office space, with 85% desiring enhanced landlord support, including amenities, services, and community events. Nearly half (46%) are willing to pay a premium for these additional offerings.
