EXPO Real: Europe avoids ‘ghost office’ phenomenon

In European countries people are likely to want to return to work, experts agreed at Real Asset Media’s The Future of Office briefing, which took place at the International Investors Lounge at EXPO REAL yesterday.

John Mulqueen

“There are no ghost cities or ghost offices in Europe”, said John Mulqueen, Head of Offices EMEA, CBRE Investment Management. “We’re still not back to pre-pandemic levels but CBDs are very busy again”.

While in the US there is a real “ghost office” phenomenon in the big cities, with San Francisco recording a 24% vacancy rate, the situation in Europe is very different.

“Companies take the presence of employees more seriously in Europe”, said Assem El Alami, Head of International Real Estate Finance, Berlin Hyp. “I’m a strong believer in the office as a place where people come together and feel they belong, rather than being mercenaries working from home with no emotional engagement or attachment to the company”.

The social aspect will play a major part in luring employees back to the workplace,

“I strongly believe the office has a purpose”, said Jens Bohnlein, Global Head of Asset Management and Sustainability, Commerz Real. “It’s a place to communicate and learn and give people a sense of a shared mission”.

Jens Bohnlein

The onset of winter will facilitate the return to the office.

“WIth energy costs going up, the dynamics will change and people will make the pragmatic choice to go back to the office to save money”, said Arkadiusz Rudzki, EVP Leasing & Sales, Skanska office development in CEE, Skanska Property. “Companies will also make an effort to provide incentives for people to go back”.

Average vacancy rates in Europe are currently 50-60%, but they are expected to go up to 70-80% in winter.

“Cooperation in a flexible office environment is very different to what you can do online”, said Dennis Kopp, Business Development Director, Korus Group. “Teamwork is speedier and more efficient and cooperation works better”.

This is reflected in the changes in office lay-outs, with more meeting rooms and less individual cubicles.

“The pandemic has really changed perspectives and requirements”, said Brian Gaffney, Director, Murphy Mulhall & Partners. “There is more emphasis on collaboration and open plan spaces rather than individual offices”.

[Images: Sabine M Mairiedl, Munich]