Artificial intelligence is making senior business leaders less willing to commit to conventional long-term office leases according to research from International Workplace Group.
Six in 10 chief executives and chief financial officers surveyed said AI had made it harder to predict how much office space their organisations would require in two years.
Almost three-quarters – 73% – said technological change had reduced their willingness to enter lengthy leases or use traditional property solutions.
The findings point to changing requirements for landlords, investors and commercial agents as occupiers seek offices that can expand or contract alongside their workforces.
FLEXIBILITY OVER FIXED COSTS
Virtually all respondents – 99.8% – said their organisations were actively seeking to move property costs from fixed commitments towards more variable expenditure.
Some 57% were investing in hybrid workspace arrangements, while 55% were considering networks of offices located closer to employees’ homes. More than half – 52% – were examining decentralised workspace models.
When asked how technology was affecting location decisions, 42% said it enabled remote working and reduced the need for a central office.
A further 39% said it encouraged decentralised or flexible models, while 37% pointed to greater access to international and distributed talent.
Cost reduction was a factor in location decisions for 99% of respondents and the primary driver for 27%.
OFFICE REMAINS IMPORTANT
The research does not indicate that senior executives expect the office to disappear.
More than three-quarters of chief executives – 76% – believe offices will become more important to their organisations over the next two years. Fewer than 1% expect their importance to decline.
The results suggest demand could increasingly concentrate on well-equipped spaces used for collaboration, innovation and company culture, but accessed through shorter and more flexible commitments.
Christian Schmitz, CEO of International Workplace Group, says: “AI is accelerating the pace of change for every business, and companies that want to succeed need workplace strategies that allow them to scale up or down quickly, reduce unnecessary fixed costs and give their people access to high-quality workspace wherever they need it.”
Mark Dixon, executive chairman of International Workplace Group, adds: “Nobody knows exactly what their organisation will look like in two years’ time.
“The future belongs to businesses that can move quickly, access talent wherever it is, and give people professional workspace wherever they need it.”
