Redesigning work places, a new fad

In the last two years, however, Intel has quietly been trying to inject a little more fun into its offices and make them places where employees can be more collaborative. The company has remade one million square feet of office space thus far in a sweeping redesign.

At its campus outside of Portland, where it designs computer chips, gray walls have been repainted yellow, purple and white, cubicle walls are lower so employees can be seen, and lounges have been outfitted with flat-screen TVs, armchairs and sleek kitchens that would not look out of place in a design magazine.

The changes are being made for more than cosmetic reasons. To promote innovation, Intel wanted to create plenty of space where people could work in groups, rather than be isolated at their desks.

Efficiency

Neil Tunmore, director, corporate services, Intel, who oversees the company’s 30 million square feet of office space, said, “We realised that we were inefficient and not as collaborative as we would have liked.”

As employees become more mobile and less tied to their desks, the average amount of space per employee nationwide, in all industries, has dropped to 250 square feet from 400 square feet in 1985, according to Jones Lang LaSalle, a commercial brokerage and property manager. Within 10 years, that is expected to drop further, to 150 square feet.

“The office status symbol seems not to be as important. People are living for more flexibility in their lives,” said Peter Miscovich, a managing director for corporate solutions at Jones Lang LaSalle.

By allotting less space per person, companies can squeeze more employees — sometimes double or triple as many — onto a floor. One newly redesigned floor of Intel’s campus can now accommodate 1,000 people, up from 600. In some departments where employees are often on the road, two people may be assigned to a desk.

Of course, sometimes the downsizing in office space is not voluntary. Companies that went through rounds of layoffs are renegotiating leases, moving into smaller offices and mothballing large real estate projects to save money. In the last three years, companies have given up 137.8 million square feet in the US, according to the real estate research firm Reis, and would most likely put more on the market if they could. Other companies are reducing their real estate expenses, which are generally the second-largest cost after employees.

Many companies are redesigning the workplaces that remain, opening them up to make them flexible for multiple uses. Even tradition-bound firms in accounting and banking are embracing open-plan offices and other changes. They have shut sections of floors to save money on utilities, squeezed remaining employees closer together, torn down walls and downsized cubicles or gotten rid of them entirely.

The accounting and consulting company Deloitte is trimming real estate costs at its San Francisco offices. Deloitte terminated a lease there five years early even though it carried a $12 million penalty and required a move. Its new landlord is paying part of the fee, according to the CoStar Group, a commercial real estate firm.

At its new San Francisco office, at 555 Mission Street, which opens this year, employees have less personal space and there are more community areas where accountants can meet clients. At nearly 1,82,000 square feet, the office is about 1,00,000 square feet smaller than the previous one. Saving money, though, is not the only reason to downsize. Opening up an office makes people interact more and, the thinking goes, be more productive.