Two Views: The Future of Real Estate
Amy Bohutinsky is a board member for Zillow Group, among other companies. As offices closed around the country, boards faced an office footprint issue. With most employees working from home, was a physical office necessary?
In this Q&A, Bohutinsky shared Zillow’s efforts to evaluate the needs of employees and how those findings will affect the company’s footprint.
How did the use of office space change during the beginning of the pandemic?
In March 2020, Zillow began with more than 5,000 employees working across 37 offices in 21 states. Zillow ended that month with the vast majority of these employees working from home.
Like many companies, Zillow first saw this change as temporary, with a return to offices within a few months. By summer, Zillow began to hear from many of its employees that they enjoyed the flexibility that came with remote work, and many were finding themselves more productive. At the same time, in its own customer data, Zillow began to see the beginning of what the company has now coined “the Great Reshuffling,” which is an extraordinary rise in Americans looking for new places to live — changes that are bound to reshape communities in the coming years. It turns out that all these months at home have made people rethink what they want in a home in areas like affordability, location and space. This confluence of the broader American reshuffling, and Zillow employee feedback, led the company to be one of the first to announce in late July that 90% of its employees would be given the option to work from home indefinitely.
Zillow will continue to have physical office space to some degree. But the company has now turned to reimagining when, and how, employees will come together post-COVID, and how a physical space plays into this.
How did 2020 affect the way corporations think about their corporate footprint?
I’ll start by saying how last year affected how corporations think about individual emsployee needs. In 2020, we learned that many professional jobs can be done at home more easily than we imagined, with the help of good internet and Zoom. But we also learned that parents are stressed, younger employees are missing out on mentorship, and “culture” can quickly erode in a virtual world. But it’s not an either/or conundrum, it’s an opportunity for companies to rethink how and when employees come together in a physical space. And in all the companies I work with, I see executives rethinking offices to better meet individual employee needs. This includes both how the physical spaces are configured, as well as how often employees come to an office versus work at home.
Was cost an issue in Zillow’s work-from-home policy?
It wasn’t. The main driver was and continues to be safety while COVID is still prevalent in our communities. But now that the majority of Zillow employees have indicated they’d like to continue working remotely at least part of the time, Zillow is in the process of redesigning office spaces to have fewer desks and individual workspaces, and more team collaboration and offsite facilities. Will this be a cost saver in the long run? That remains to be seen. Right now, the focus is on employees and the new ways people will come together to work.
What were the boardroom discussions about the real estate in the company’s hands (owned or leased)?
Our boardroom conversations have been primarily HR-driven. Are our employees safe? Do they have the support and resources they need to work from home? And what are they telling leadership they want from their jobs and employer during this stressful time? We’ve had much dialogue about the future of work, but frankly very little yet about the future square footage. Square footage considerations are a consequence and not a driver.
Given that, what is the strategic plan moving forward? If it’s shrinking, do you think your office space needs will expand again in the future?
That’s to be determined. What I do see in the future at Zillow and many other companies is employees having a lot more freedom in determining where and how work gets done, including when and if they come into an office. There will be more defined structure around synchronous meeting hours and asynchronous work hours, allowing both at-home and in-office employees to collaborate across locations without Zoom burnout. And with this, office space is looking a whole lot different than it has in the past.