To answer these questions, maybe we first must answer: is Covid really over? Is it in our rearview mirror? From my casual nonscientific observation, Boise citizens have ditched the masks and are now crowding the restaurants and watering holes. I still see some social distancing, but I don’t see the same fear of contact with other humans that I saw just months ago. I was confused at first by the sudden relaxing of the mandate to wear masks by the CDC and Dr. Fauci. And it seemed to me from the media reporting that a lot of other people were confused too. “To Mask or Not to Mask,” that is the question (nod to Shakespeare).
So, what is happening here in the greater Boise office space market? Well, a lot of things:
- The workforce has largely returned to the office, save for those larger, corporate, back-office employees.
- The downtown Boise office market is showing signs of life.
- The West Boise market is soft with less leasing activity.
- The office markets in Meridian and Eagle are tight with less available space and more leasing activity.
- Overall there is some space offered for sublease but not as much as was expected. And the available spaces are in larger sizes.
Recently, we talked to three of the area’s large local developers and learned the following:
- From Sundance there are several pending lease transactions with out of area/new to Boise companies. The rest of the prospective tenants are already here. When asked if any tenants were modifying their office design or layout because of Covid protocols, the answer was a resounding no.
- From BVA, roughly 60% of their prospective new tenants are from out of the area. So, it was a mixed bag. And again, none of the companies were designing their new office space with Covid protocols.
- The Rafanelli and Nahas Company is finishing construction on the brand new Class AA office building at 11th and Idaho Street. This building was under construction during Covid and has had surprising leasing activity (surprising in the sense that downtown has been quiet regarding office leasing). The developer said that the tenants who have executed leases were either new to the area or were existing local tenants with a small local presence. And again, and now for the third time, the tenants were not redesigning their office layouts to accommodate Covid protocols.
Another interesting insight, is the need or desire to return to the office is pushing toward a ‘hybrid’ work week. What this eventually looks like depends on location, industry, and demographics.
- If you live in LA or Houston or other traffic congested bigger cities, not having to drive would be gift from heaven, saving you hours of your day, less stress, and and less wear and tear on yourself and the car.
- But if you are a newer and perhaps younger employee you would want to be at the office to learn, see and be seen. One writer earlier penned if you hired a new person and onboarded them remotely with little chance of working at the office with the group under the watchful eye of the managers, the employer should buy that employee a T-shirt that says DO NOT PROMOTE ME.
- On the other hand, certain demographics and professions such as seasoned engineers or managers might more strongly adopt the work remote mentality.
- Having all employees work remote ignores the fact that humans like to run in a herd. We feel more comfortable and maybe safer in a group. Even the most introverted want to be part of a group. They may not want to ever say something but they want to be able to listen and collaborate.
Lastly, one important point overlooked by the futurist was that office leases tend to be 3, 5 or 10 years long. The landlords aren’t obligated under the lease to rip out the old walls and workstations. So, unless the tenant wants to spend a boat load of money to reconfigure the space, it isn’t happening.
It sounds to me that while the work week may look different, the “office of the future” may look a lot like the pre-pandemic office.