Why Forcing People Back to 20th Century Offices Kills 21st Century Innovation
AI won’t save broken systems but expose them. The future of work won’t be built on square footage or legacy thinking, but on culture-first strategies powered by insight, not nostalgia.
The Corporate Real Estate industry (CRE) once ruled with unbridled confidence, built on permanence, predictability, and presence. But COVID didn’t just disrupt it, but exposed a brittle model clinging to old assumptions about where and how work should happen.
Now, as legacy players attempt to hit rewind on the office, a deeper truth is emerging: the world of work has permanently changed and the future won’t be shaped by glossy HQs but by agile, tech-enabled strategies rooted in talent, not tradition.
For SME leaders, this is a reminder to ignore the noise and instead design smarter ways of working, blending culture, flexibility, and AI-driven insights. Don’t follow CRE’s nostalgia. Build your own future of work.
Key summary:
🎯 Focus on outcomes, not bricks and mortar optics.
🧠 Leverage AI to power trust, productivity, and culture.
🏢 Let real estate support your business — not dictate it.
When Corporate Real Estate ruled the world.
To understand the present, let’s look at the past. Once upon a time, in a world far more predictable than today, the CRE function thrived via a business model built around a few key assumptions:
Work happened in an office, the glass container of productivity. Stacked high, desks were permanent and full-time, 9-5, Monday-to-Friday presenteeism unquestioned. Maxing out occupancy was the key.
Real Estate was always a long-term safe investment. Multi-year (even decade) leases, and a strategic asset that was also a fixed cost justified through the presence of worker bees. The plusher it looked, the more it said about its business success.
Safe in its silo. Like its peers, stayed in its lane, often losing out to the adjacent worlds of Tech and Culture as work get reimagined.
Predictability was built off static occupancy models and the industry dined off the back of borrowing cheaply, long-term leases, renting high (with escalation clauses) and asset appreciation.
What started as an asset became a financial instrument, much loved by fund managers the world over. Cost per square foot, not value per employee experience, was king.
Why COVID, and beyond, blew the office doors off.
This is a case study in how unpredictable events don’t just disrupt but expose the fragility of the industry’s business model. New assumptions stopped it in its tracks:
The entire global workforce went remote overnight. Remaining productive and successful. What’s the point of the office now?
Occupancy plummeted but leases remained. Exec teams began to ask obvious value-laden questions. What’s the RoI?
Flexibility rose up the employee agenda. Talent demanded it, CRE hated it. Where’s the office in the new employment deal?
Lack of infrastructure hit hard. No legacy in technical solutions to drive hybrid, dynamic planning, employee experience or the measurement of success. Where’s the digital footprint?
The outcome disproved the core value statement at the heart of the industry since the workhouses were built. Remote-first businesses sprouted up. Our people can now work, thrive, and survive outside of the controlling assumptions of traditional CRE universe.
The Empire Strikes Back. And misses.
Three years later and a noisy group of vested interests have seemingly solved the conundrum by turning back the clock. One industry veteran commented on LinkedIn, as HSBC joined Barclays, UBS, JP Morgan, and Amazon on fixed RTO mandates:
“Great to witness the pendulum swinging back to normalcy for core businesses.”
But of course, there is no return to normalcy. In the last 3 years the CRE industry has struggled to offer a viable, scalable alternative to the traditional office model for deep-rooted structural (slow moving & permanence business models), cultural (predictability over dynamism), and operational reasons (incentivises presenteeism over remote, poor data & digital fluency and siloed). All this when work itself has radically changed.
So instead of using the time to reinvent space around new ways of working, some have tried to reassert old models (e.g., return-to-office mandates) in new contexts, alienating talent in the process.
That’s not just logistical resistance, it’s ideological inertia.
The layering continues. The evolving AI & Work problem.
Bad enough when the argument was placemaking, the world of work has now moved at pace with the evolving AI storyboard and how we organise for future success.
More tech utility has arrived to help us redefine what productivity looks like, how teams collaborate, and even what kinds of roles need to exist. Fluid, agile talent produces different workforce planning assumptions and intelligence is the new oil, as we drive data to help us make sense of the world ahead.
There remains no case for the 1980s playbook to be applied.
What should SME Leaders do?
Firstly, there’s clearly an opportunity for forward-looking CRE to pivot toward flexibility, tech integration, and user-centricity, but while it waits for proof of concept or focuses on arguments from the 1980s, there’s no time to waste.
Don’t wait for CRE to solve the problem for you. Instead, design your own space strategy, agile, tech-enabled, and talent-focused and let CRE catch up.
If you're an SME leader, success is based on the following winning signals rather than following the noisy headlines:
Signal #1: Culture doesn’t die in remote work. It dies in poor communication and weak leadership. Build systems of mentorship, feedback, and knowledge-sharing that work regardless of geography. Use AI-driven tools to enhance collaboration, sentiment analysis, and employee engagement in hybrid environments.
🚫 The noise: That “real work only happens in the office.” That’s nostalgia, not strategy.
Signal #2: Real Estate Strategy Must Align with Value Creation. They’re still betting on the office playing a “meaningful” role. For them, that’s about optics, brand presence, and operational control. Don’t invest in office space out of tradition or sunk cost. Use data (and increasingly, AI) to assess real estate ROI, in terms of team performance, innovation, retention, and client impact. Flexibility often is the strategy.
🚫 The noise: Assuming you need a permanent desk for everyone to prove your company’s legitimacy.
Signal #3: Consistency Is Good. Rigidity Less So Have a clear, principled hybrid policy, but tailor it by role and outcome, not attendance for attendance’s sake. Use AI performance analytics to assess what patterns drive results and employee satisfaction.
🚫 The noise: That equality = identical rules for every team. True fairness lies in clarity + flexibility.
Signal #4: Trust and Control Must Evolve. Especially With AI in Play. Risk management matters, but surveillance breeds mistrust. Instead, leverage AI for secure, real-time compliance monitoring, fraud detection, and productivity insights, without micromanaging. Trust is a retention asset.
🚫 The noise: That in-person equals trustworthiness. Bad actors can sit at a desk too.
Final Thought: Find Your Hybrid Edge.
The big institutions named are acting in their own context. One of brand reputation, regulatory scrutiny, and fixed institutional habits, for good or for bad. That’s their reality.
As the SME CEO, yours is different: you’re more agile, closer to your teams, and better positioned to experiment.
🔑 Focus on outcomes, not optics.
🧠 Leverage AI to scale culture, productivity, and trust.
🏢 Let CRE support your strategy, not shape it.
“The future of work isn’t about being in or out of the office. It’s about designing work that works, powered by data, trust, and increasingly by smart technology.”
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