Urban Land sat down with Project Management Advisors president and CEO Roger McCarron during the 2021 ULI Fall Meeting in Chicago to talk about the employer/employee return-to-office “negotiations.”
McCarron says when the pandemic initially struck, it was a “tough decision” to send his employees home and he wondered how he would bring them back after the pandemic was over. No one was going to give them an “all clear.”
Project Management Advisors, based in Chicago, employs about 150 people who work in offices in Los Angeles, San Diego, San Francisco, Austin, Orlando, and, as of late August 2021, a 5,000-square-foot (464 sq m) space in the Empire State Building in New York City.
For the first six to nine months, McCarron recalls, remote working was about personal safety, protecting employees, saving jobs, and simply getting to the other side of the crisis. It was not until this fall that the executive realized the transition from remote working to office working was not based on falling COVID cases or the easing of travel restrictions.
“It was really the first time when people were openly expressing a desire to not come to the office,” McCarron says. “And I don’t think it was health related. For the most part, it was like, ‘I get stuff done at home.’” While the sentiments were delivered to McCarron “colleague to colleague,” he felt they were, in fact, notes to the board of four of which he is also a member.
That it came as a surprise was not for the lack of return-to-office headlines about employees at other companies wishing to remain remote or in a hybrid work environment. McCarron just didn’t think employees would feel the same about Project Management Advisors, which he calls an “intimate organization,” one in which each employee is known.
“We really believe in [culture] and we foster it; we embrace it. We want the employees to make the culture and we support it. We don’t want to necessarily create culture from the top, but I’m sure there’s more of it than I realized,” he said.
Rather than make a long-term decision, McCarron and his board decided to come up with an interim plan to get people back to the office in hopes of reminding them of the intangible benefits of working together. To that end, the company implemented a policy of working in the office two days per week, on the honor system, though McCarron has doubts that the company is hitting two days across the board. “We want to create an environment in the office so that when you are there, there’s a benefit. If no one’s there, it’s self-fulfilling.”
The intangible benefits of being in the office include unscripted conversations where employees learn something or overhear something of value, the ability to give and receive advice, and even the ability to see body language that could help to identify a struggling employee. “So much of the learning in the office is unscheduled activity,” McCarron said. “I don’t know how you replicate that.”
Even so, McCarron admits that the hybrid and remote work models have been successful for certain tasks and projects, particularly at the height of the pandemic. For instance, One Steuart Lane in San Francisco, a high profile, highly technical, high design 20-story luxury waterfront condo tower for which Project Management Advisors supports the developer, New York City-based Paramount Group.
Designed by Skidmore, Owings & Merrill (SOM), early in the pandemic work on the $200 million-plus edifice was completely shut down by government mandates. While it was clear-cut that employees who worked on construction would have to report to work at the site, there was discussion on the owner’s team about the value of visiting the job site.
Incredibly, the project was delivered just a few months after its pre-COVID completion target, with six months of very limited site visits on the owner side. “People were finding ways to use technology and the architects were doing site visits with essentially the superintendent walking around with the phone, projecting video live, and they would say ‘Let’s go look at this; let’s go closer there.’” Other technology, like the project’s webcam and point-cloud progress photography, suddenly proved prescient.
So far, Project Management Advisors, which occupies roughly 30,000 square feet—about 200 square feet per head—across its seven offices, has not turned a lease but McCarron says he’s more likely to take a look at how the space is used rather than giving any back right away, especially given his firm’s 10-year run of 15 percent year-over-year growth pre-pandemic.
During the ULI Fall Meeting, comments from Ben Breslau, chief research officer, with JLL, resonated with McCarron in particular. Speaking on a forecast panel, Breslau reaffirmed that most employers want their employees back in the office to drive culture and innovation, to collaborate, and to build loyalty. (According to Breslau, statistics show that remote workers have less affinity—or loyalty—to a company and are more likely to jump to another company than employees who report to an office.) Breslau is also a coauthor of a new book, The Workplace You Need Now: Shaping Spaces for the Future of Work.
The success of remote working versus in-office or some hybrid of the two is unlikely to be known any time soon. For example, the concept of “productivity” tallied by adding up the number of tasks completed by hour, would likely increase by reducing commute time. But how do the hours gained balance out with the longer-term impact of a remote work environment on an employee’s career in terms of building networks, getting needed mentorship, and building relationships?
“What’s really interesting is this balance between employee preferences, which I think most companies across industries are catering to because of the war for talent,” Breslau said. “Talent and employees are in the driver’s seat right now. And companies are being very careful and offering flexibility.”
Like McCarron, Breslau said a lot of companies will remain flexible for the time being rather than risk losing employees. Given the long-term nature of office leases, many companies will stick to the space they have, potentially rethinking existing space when return to the office, perhaps adding a different mix of amenities and collaboration space.
“There are plenty of companies saying we’re going remote,” Breslau noted. “There are plenty of companies saying, ‘We want everybody back in the office’ and most people are falling in this hybrid world.”
Breslau predicts companies utilizing hybrid work models will drive down office demand by as much as 20 percent, however, that grim forecast will be offset somewhat by de-densification and more collaboration space, which can be seen with big tech companies and others actually taking down more space now. Obsolete office space that won’t fly in a post-COVID world is also likely to reduce office inventory, however, meaning the net impact “isn’t going to be as big as the headlines would tell you,” Breslau said.
At the end of the day, McCarron believes that five-day work weeks will never be universal again and that at some point Fridays will be “renegotiated to a weekend day like Saturday was 100 years ago.” The upside: the best buildings will continue to be in demand.SIBLEY FLEMING is the editor in chief of Urban Land.
More from Urban Land on the Return to the Office:
Stranded Assets: Realizing the Potential of Old Malls and Abandoned Office Parks
Bringing More Class A Office Space Back to Kansas City’s Downtown
Pillars of Design
Don’t Write Off the Office: Key Takeaways from Industry Leaders in Asia Pacific’s Top Markets
Swig Company Certifies Office Portfolio with WELL
