Pandemic may force nearly 75% of biz to downscale office space: Survey

• According to a Lanka Property Web survey, close to 50% of firms planning to keep all or some of their office-based staff working from home
• Over a quarter of respondents say they will continue work from home as part of their long-term business strategy

Close to three-quarters of Sri Lankan businesses say they might downscale utilisation of their office space during the next 12 months, since nearly 50 percent of the businesses are planning to keep all or some of their office-based staff working from home on a long-term basis, as the pandemic upended how companies 
view work. 

In a survey conducted by Lanka Property Web, the company which owns the country’s leading online property portal lankapropertyweb.com, from end-May through early August has shown 73 percent of the respondents planning to scale down their office space during the next 12 months, as close to two-thirds of the respondents expect the effects of the pandemic to linger between six months to more than a year. 

When the pandemic forced the businesses to temporarily close their brick-and-mortar office buildings from early March, as a measure to stem the spread of the virus, companies quickly facilitated their office-based staff to shift their work to their homes. 

While some companies have asked either full or part of their office-based staff to return to office, with the lockdowns easing from mid-May, others, particularly in areas such as information technology, research and development and consultancy, where employees can continue to operate from home, have allowed their employees to continue to work from home.According to the results of the survey, 21 percent of the businesses did not want their staff to return to their offices at all on a daily basis while another 33 percent have said 25 percent of their staff is required at the office, with another 27 percent preferring half of their staff to be at the office during the immediate aftermath of the pandemic. Meanwhile, the balance 18 percent has said they want 75 percent to 100 percent of their staff to be in office.

To the question of how long they expect this practice to continue, a little over a quarter of the respondents have said they would continue this practice as part of their long-term business strategy, while another 17 percent expect the practice to remain at least through the end of 2020. 

Meanwhile, 44 percent of the respondents have said they are planning to let either all or some of their staff to continue to work from home. While the remote working arrangement could have implications on the utilisation of office space, the ability to afford higher rents for an office building in a prominent metropolitan location by an entity, at a time when business is down, could also force it to either cut its square footage or relocate itself to a much smaller and an affordable suburban location, considering commercial real estate rates.

The results, though do not spell an end to the traditional office, could have some serious implications on the commercial real estate market in Sri Lanka, at least in the short term. 

Meanwhile, after a few months into the work from home experiment, some companies have started to think the arrangement isn’t so great after all, as projects take longer, collaboration becomes harder and bosses fear that younger recruits aren’t picking up skills faster as they would in offices, sitting next to their colleagues and absorbing how tasks are being performed. 
Hence, while remote working could be a short-term solution to get work done during the pandemic, from a safety standpoint, some companies say it is not their preferred long-term solution once the virus passes. 

Meanwhile, Lanka Property Web said the survey results should not be considered as conclusive, as it had been conducted based on information collected from 70 respondents, with a margin of error of plus 6 percent. 

Fifty-three percent of the respondents were private limited companies while only 7 percent public limited companies participated in the survey. Nearly three-quarters of the respondents were either large or medium-sized firms.