Technology, the urge to go green, telecommuting and a generation of workers who grew up with smartphones in their hands and computers in their laps are revamping the work culture. Companies are knocking down walls, even dismantling cubicles to create a free-flowing layout that many believe gets the creative juices flowing and encourages collaboration.
Younger workers welcome the change, says Patricia Lancaster, head of The Lancaster Group real estate consulting company who teaches at New York University's Schack Institute of Real Estate. "They don't aspire to the big corner office," she says. "They don't even want it."
And they don't need an assigned work station to call their own. Their cherished family photos adorn not their cubicles but their computers' wallpapers. They're kept on smartphones and posted on Facebook, not pinned to a bulletin board at desks.
At the same time, office equipment from printers and copiers to computers are shrinking. The paper trail is also waning, making big file cabinets obsolete in many work areas.
There's an added bonus for employers: Open floor plans accommodate more workers in less space, a welcome savings for companies scrambling to cut costs in a rough economy. Efficiency is also at a premium at a time when environmental concerns are on the rise.
A survey this year by CoreNet Global, an association of corporate real estate and workplace professionals, found that for many companies, the average allocation of office space per person will fall to 100 square feet or less within five years.
Only 24 percent of the 465 companies surveyed said they had already hit this low, but 40 percent said they would by 2017. Square footage per worker has already slipped from 225 square feet in 2010 to 176 today, according to CoreNet.
The main drivers: More companies stressing "collaborative and team-oriented space" and "smaller but smarter" offices in a bad economy, says Richard Kadzis, CoreNet's vice president of strategic communications.
The trend is expected to accelerate as 10-year and 15-year leases signed in the late 1990s and early 2000s expire.
"That is going to encourage companies, when they do go to market in this new environment, to try to make upgrades to a 21st century office space," says Dan Fasulo, managing director of Real Capital Analytics. "It absolutely makes sense. Your more forward-looking firms have already made the transition."
Offices traditionally use 200 to 300 square feet per worker — an average of everything from clerks' cubicles to executive suites. By encouraging staff to work from home, getting rid of offices, even resorting to "hoteling" — workers check in when they're in the office and get assigned a desk for the day — some companies are slashing average square footage per worker to less than 100, about the size of a one-car garage.
"Obviously, you're going to need less space when you have open space," says Adam Leitman Bailey, a New York City real estate lawyer. "American workers need less space than they did 10 years ago. Just by not needing an office, you're saving space."
Working in the city
The move back to cities and to urbanized suburbs close to city centers, transit lines, shops, restaurants and apartments is helping fuel the trend. Space in developed areas is more expensive and harder to find, but that's where younger workers want to be.
"Cities around the world are competing to become creative digital lifestyle centers," Lancaster says. "To do that is not how big offices are. (Young workers) are into culture, parks, working closer to home, having dogs in the office."
By being located near urban services, companies are saving space. Not as many workers drive, so fewer parking spaces are needed, and eateries and fitness clubs are nearby, so there's no need for a large cafeteria or on-site health club.
"We consider the entire city to be a workplace," says Patrick Olson, who heads the development of Zappos' new downtown campus in Las Vegas.
Now headquartered in Henderson, Nev., Zappos will move next year. The company now averages about 120 to 150 square feet per employee. When it moves into its new digs in the old City Hall building, it will slash the ratio almost in half.
The trend "could help lead to somewhat of a rebirth in some of these older cities," Fasulo says.