Despite almost all European office employees working from home (WFH) last year, empty workplaces did not lead to a reduction in the expenditure that companies had to fulfil had the workforce been in the office.
That is according to research by Colliers which collected data from 3,990 buildings in 29 countries.
The property services firm said its Occupier Cost Index (OCI) demonstrated the average costs per FTE (Full-Time Equivalent) fell by only 2% and amounted to €9,468.
Colliers pointed out its data comes at a time when the importance of facility management and the utilisation of office space is a hot topic. And, with more recent stay-at-home orders in the face of the so-called Omicron variant, it is likely to take on greater significance still.
As a consequence of the pandemic office services were modified to reflect the low occupancy rate, but some existing contracts were not possible to alter, such as a company restaurant.
Said Denise Hoogendoorn, head of facilities management consultancy in the Netherlands for Colliers: ‘The working environment was adapted to the new situation through minor alterations, but larger investments into building design and the working environment were postponed until the utilisation of the office environment was better understood post pandemic.'
‘Only variable costs such as meeting services were discontinued, but this outlay was partly replaced by the higher costs incurred for the establishment of home workplaces or extra cleaning of the office. This demonstrates the inflexibility of some facility management contract.’
Switzerland is the most expensive country in Europe and has even increased its cost per FTE from its nearest competitors of Norway and Sweden. Costs rose by 2% last year to €18,713 per FTE. Costs in Norway decreased by 7% to €16,645 per FTE. Costs in Sweden also fell by 5% to €16,231 per FTE. Bulgaria is the cheapest place to operate.
Nicholas Marsh, head of enterprise facilities management advisory for occupier services in EMEA at Colliers, concluded: ‘Our research has highlighted that most corporates had to sustain expenditure in property and operating costs, despite buildings being empty during the lockdowns across Europe.’
‘Whilst we all recognised the opportunity to rationalise property portfolios to reflect new hybrid working and lower occupancy levels, the reality is that existing lease structures prevent short-term portfolio adjustments. This is highlighted by only a 1% decrease in occupancy costs per full time employee in the UK. Looking forward property strategies will leverage the value of reduced space, flex space and co-working environments – all of which will be reflected in our forthcoming OCI data.’
