The prolonged work-from-home experience and questions about where employees will want to work, post-pandemic, leave many companies unsure of their future office needs – as well as what the future of the center will look like. city of the city.
“Welch, as an organization, continues to be careful with our office planning given the uncertainty in how much space we will need over the next few years,” says Jim. McConnery, managing partner at Welch LLP. “We know staff appreciate the improved work-life balance that comes from a hybrid model, but it’s clear that a similar approach by other employers, including the federal government, is having a major impact. on the city center.
A reduced need for office space may also result from employers shifting to hybrid working models; 46 percent of respondents say they expect to have such an arrangement with staff.
“Partners and staff have adapted effectively to a hybrid work environment with a view that we likely wouldn’t revert to our old operating model even if there were no more COVID challenges,” adds McConnery. “A hybrid model allowed us to add staff without expanding our office footprint based on being able to implement a guest house model for staff who don’t work in the office full time.”
At the same time, 77% of respondents to the Welch LLP Ottawa Business Growth Survey say they expect their organization’s commercial real estate footprint to stay the same or grow.
“Returning to work is exciting,” says Tim Thomas, partner at Perley-Robertson, Hill & McDougall, specializing in real estate law. Most of the time, Thomas says, he finds himself alone in the gymnasium of his company’s downtown high-rise. He predicts that Class A space will become more affordable for customers who otherwise would have considered it out of reach. Similarly, Class B and C properties will see changes in use, possibly from commercial to residential.
This scenario is especially true for the downtown core, where the federal government’s need for office space will likely decline as more public servants opt for hybrid work arrangements.
“I don’t think the government is going to completely give up space…but I think it’s definitely going to be reduced to the city center and I think there’s going to be a lot of interesting changes in the use of some of these buildings”, comments Thomas .
“The problem with a lot of these older buildings is that they need updating anyway, so do you spend upgrading commercial tenants or bite the bullet and convert them into residential use?”
Another ramification of hybrid working for federal public servants is that more of these employees, who have traditionally lived and worked in the region, could be hired from outside Ottawa-Gatineau.
“If (the federal government is going to) have, say, a 30% remote workforce, then they can be in Moncton or Calgary or wherever, but I still think there will be pressures that they have a strong presence in Ottawa,” observes Thomas. “But even a 5% or 10% reduction could have an impact.”
Likewise, adds Thomas, Ottawa residents could stay in the city and work for employers outside the region.
Sueling Ching, President and CEO of the Ottawa Chamber of Commerce, is excited about reinventing downtown. She says the federal government as an employer has provided Ottawa with a “bubble economy” for many years, but now needs to be clear about its intentions for downtown to maintain business confidence and show leadership in bringing employees back to the office.
“Our downtown is an economic and cultural hub for our entire city in the nation’s capital, which is a beacon for the whole world,” she said, adding that the visitor economy is the “gateway” for all other types of economic development. .
“Is downtown important to all major cities in Canada? One hundred percent. Does it matter to Ottawa? One thousand percent.
Visit https://www.ottawabusinesssurveyreport.ca to download your copy of the report.