Hong Kong’s office workers overwhelmingly want to have the option of working from home, as more than 12 months of lockdowns and quarantines have upended corporate culture and work arrangements, with spillover implications for the world’s most expensive urban centre.
Two out of three respondents in the inaugural survey conducted by Microsoft said they want remote work options to remain, while 65 per cent of Hong Kong’s corporate leaders said their companies are planning to redesign their office space to accommodate a “hybrid’ culture that combines in-office and work-from-home arrangements.
“Physical office space must be compelling enough to entice workers to commute in, and include a mix of collaboration and focus areas,” according to Microsoft’s Work Trend Index report, an online survey involving more than 1,000 full-time office employees in Hong Kong conducted with Edelman Data x Intelligence between January 12 to January 25.
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The survey underscores the precariousness of Hong Kong’s commercial property market, as overall availability rate rose to a 17-year high of 14 per cent in the first quarter, with large occupiers such as multinational corporations surrendering their space while their employees were stuck working from home during the coronavirus pandemic, according to data by Cushman & Wakefield.
At its peak in 2018, the average annual rent in Central was US$307 per square foot, surpassing London’s West End by 30 per cent and almost 53 per cent more than what it used to cost to rent a space on Beijing’s Finance Street, according to data by CBRE. Rental charges across Hong Kong had plunged by 24.4 per cent from a record in the first quarter of 2019, while the cost of leasing space in the greater Central district plunged by 29.1 per cent, Cushman & Wakefield said.
Overall office demand will decrease with the use of both office and remote work as companies do not need their full team in the office every day, said Cally Chan, general manager of Microsoft Hong Kong and Macau, which set an early example of flexible working policy way before the coronavirus pandemic struck.
The use of collaboration software in office can benefit companies from property developers to those engaged in the supply chain, Chan said. For employees of real estate companies who work in remote sites, video conferencing software and document sharing applications can significantly reduce the time needed to synchronise information sharing, she said.
For a global logistic company engaged in fashion, with co-editing and information sharing, it can reduce the design cycle from six months to three to four months. For a fashion business, time in monitoring the latest market trends is critical so it can increase their profits, she added.
Chan also had a successful experience with a video conferencing training that enabled the procurement staff of a company to develop an app by themselves to keep track of materials. This stimulated employees’ innovation and productivity.
Digital transformation is “not a privilege” of big companies and is “relevant to everyone and every company,” she said, adding that Microsoft worked with partner companies to help smaller firms rent devices for free along with other digital solutions and technical assistance. “We adopted flexible working policy since 2005 to empower our employees to work anytime, anywhere, by taking advantage of our technologies and tools.”
Since it was established in Hong Kong 30 years ago, the staff size of Microsoft has expanded 30-fold to nearly 300 today without dramatically expanding its office space. The company moved to its current address in Cyberport in 2002 as the anchor tenant, taking up over two floors of office space and has been using the same space since then.
In 2016, its space underwent a design transformation to enhance innovation and productivity as they adopted hybrid working, by providing functional areas from focus room to collaborative meeting spaces to meet different needs for employees.
Still, work-from-home arrangements would have limited impact on Hong Kong’s office market, because many homes are small and ill-suited to such arrangements, said Colliers International, which expects rent to decline by 7 per cent this year as the city’s economy stabilises.
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