Hong Kong, Singapore, Tokyo office markets likely to survive work-from-home arrangements as small flats seen limiting productivity
- Office vacancy rates in Hong Kong and Singapore have risen in recent quarters due to remote working, economic slump
- Space constraints due to tiny flat sizes in Asian financial hubs not ideal for work from home due to productivity concerns
In Hong Kong, the average size of a flat is 40 square metres (430.5 sq ft), or about the size of three typical car parking bays in the city. Along with 68.8 square metres in Tokyo and 90 square metres in Singapore, the trio have among the smallest dwellings in the world, according to property consultancy JLL.
“We would argue that in places like Hong Kong and Tokyo, and to a certain extent Singapore, because we are living in smaller spaces, it’s not (best) for people to work at home,” said Jonathan Hsu, head of research for Asia at private equity firm M&G Real Estate. “They either have no place to set up a workstation, or they do not have a quiet place to set up a workstation. It’s actually more productive for them to work in the office.”
Companies worldwide have allowed a large swathe of employees to work away from offices as governments imposed lockdowns to stem the coronavirus outbreak. Some arrangements are likely to last for months or even permanently; San Francisco-based Twitter announced in May that it would let employees work from home “forever”.
In the big picture, the future of the office also depends on the corporate culture, Hsu said. Companies might offer flexibility to workers, and the use of office space will evolve, JLL said.
“We do not see work-from-home having a large impact on the long-term demand for office space in Hong Kong,” said Roddy Allan, chief research officer at JLL in Asia-Pacific. “We do see that some employers such as JLL may provide more flexibility for employees to work from home when needed (such as) possibly one day a week. However, we see the office as remaining the central hub of companies and core to their success.”
This is also likely to be the case for Singapore, according to Colliers International, despite the rising popularity of remote working and flexible workspace options.
“This does not mean this is the end of working in the office,” said Rick Thomas, head of occupiers at Colliers. “This means that the workplace is set to evolve. Occupiers are now considering whether their offices will be a place to work or a place to meet, and factoring this into their overall strategy.”
As for Tokyo, younger workers are finding working from home a challenge, given that they typically live in tiny flats, with sizes of between 18 and 30 square metres, according to Cushman & Wakefield.
“While some around the world questioned the value of office in the future, we believe office still has its value as an equipped environment with a proper desk, printer, a resource centre, a focus room, quiet spaces and a place for face-to-face communication,” said Hideaki Suzuki, director and head of research and consulting. “In the long-term, rather than a place you must go or attend to your job, office space would probably become somewhere you will go for a specific task or resource.”
