Space Utilization Analytics for Real Estate
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Space Utilization Analytics: A 3-Minute Primer

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We are in an era of space underutilization. Simply put, a massive amount of corporate real estate is not being used. And even the areas that are being occupied are not necessarily being used well.

Some of the statistics are downright alarming:

  • 40% of corporate real estate (CRE) is empty despite being paid for
  • 89% of CRE executives are not satisfied with the use of space at their company
  • 67% of surveyed workers cited a workplace that was not optimized for their needs as a reason they left their previous role

Meanwhile, companies across all industries continue to preach efficiency and assure shareholders that they are doing everything in their power to maximize profits. Well, the ongoing, massive underutilization of space flies in the face of all that talk.

Fortunately, data and analytics have arrived to rescue companies — from themselves. By better tracking usage and understanding what employees actually need out of their workplace to get the job done, organizations can immediately improve the way they use space.

At Density, we talk about this in terms of “space utilization analytics.”

The term can sound complex, but it’s really quite simple.

Think about Goldilocks, one of history’s unheralded pioneers in applying trial-and-error to optimize experience.

To make the best decisions, she understood that feedback from her environment was essential. The first bed was too soft. The next too hard. It wasn’t until after gathering a third data point that she understood which space was just right. Without even realizing it, Goldilocks was conducting an iterative experiment to find what best suits her needs.

This fairytale serves as a great metaphor for the real-world workplace of today.

There was a time when everyone was merely looking for the right-size real estate. But the conversation has changed. And as the pendulum continues to swing from thinking about workplace design in terms of cost efficiency toward a mentality of maximizing employee experience, it is critical to gather feedback and data.

The cost question hasn’t gone away. It never will. But effective workplaces now strive to balance efficiency with employee experience. This realization has been ongoing, including hiccups along the way as different people latched on to different causes. First there was backlash to cubicles, and now many are railing against open offices. But all of this misses the point.

In different situations, different employees need access to different spaces. If they are stuck in one spot, they will never discover the other options that may serve them better for different types of work. One day, a worker may be deep in individual focus work, whereas tomorrow will be a day full of collaboration. These tasks are quite different and require different spaces to be achieved optimally.

Space utilization analytics are a means to understand how locations are used.

At least that’s what our clients continue to tell us as they progress on their journey to optimize the workplace.

But getting back to the original question: What are space utilization analytics?

Space utilization analytics are a means to understand how locations are used. How many people are in a room compared to how many people it was designed for? Are people using a space as frequently as we expected? Are they using it in the way we intended? How do we scientifically look at a workplace and determine what our employees need to succeed — and what they don’t?

There are many ways to use this information. First of all, you can reduce costs — an easy-to-sell benefit to those executives concerned about square foot. You can also simplify space planning through an data-driven user interface (UI) that offers deep insight into portfolio management. And you can also continually “validate needs” of employees through real-world feedback about how each room, floor, and building are actually being used.

This last factor can be the least intuitive benefit, but it is quite powerful.

Essentially, it allows you to design spaces with a theory in mind about how workers will occupy those areas. This creates an experimental mindset in which you can test a hypothesis and watch it play out. Are those complaints about break room seating accurate? Or, after you monitor the situation, do you see that there are an adequate number of chairs — it’s just that everybody wants to sit on the same comfy couch. The room is large enough, but you have now learned that the fancy chairs you bought are a flop.

Being able to prove assumptions — correct of false — can be incredibly valuable. It not only allows for adjustments to be made easily in response to changing circumstances, but fosters a mindset of adaptability. The space can evolve as it needs to and you aren’t wasting money by forever allocating square feet for needs that no longer exist or drive ROI.

Really, the application of data is simply the next evolution of improving spaces.

Because, at a base level, it all comes down to one thing: Workplaces exist so that employees have a place to get things done. To do that best, they need the right tools and the right spaces. And you will never know if you are providing these critical resources correctly unless you apply space utilization principles and analyze outcomes.

For even more info on how Space Utilization Analytics can help any organization get more out of its workplace, register for Density’s “Intro to Space Utilization Analytics” webinar.