The current space per office employee has fallen nearly 5 percent from pre-pandemic levels to 152 square feet, according to a recent insight from CBRE. That figure represents a 22-year low for per-employee office space allocations and goes against what some expected would be social-distancing requirements that would boost per-employee space.
While the change seems sudden, CBRE notes that since 2009, square feet per employee has steadily declined. Before 2008, corporate office footprints were growing, but densification strategies took over after the financial crisis. CBRE says a similar dynamic was happening with office space in the mid-1990s when the economy was recovering from a recession amid an excess of space.
How much office space a company leases indicates near-term space usage and also future growth expectations. Leaner office footprints can reap significant cost savings for corporate occupiers, but it often leaves little room for growth. Given the current economic uncertainty and shift to hybrid and remote work, occupiers may believe additional space could be easily procured at attractive rents if needed. Either way, space per employee is a metric office landlords and investors will want to keep an eye on.