OPINION: Gottheimer gets it

Everyone knows that uplifting feeling when they come across someone who thinks exactly the same way they do. Well, I’ve just had that feeling. The person in question is Josh Gottheimer, who serves New Jersey’s 5th Congressional district in the U.S. House of Representatives. He’s the motive force behind a campaign to give tax benefits to New York-based businesses that open offices in New Jersey, so that workers from the state don’t have to commute to the Big Apple every day.

This is what he said that’s so close to my heart.

“When you add it all up: the expensive tolls, the cost of parking and gas, and the congestion tax, Jersey commuters would save $20,000 a year to stay in Jersey. Not to mention, all the benefits of less stress, more productivity and time with families from the hours spent not driving. The bottom line is that by staying and working in New Jersey, our residents will have more money in their pockets, our state and local economies will flourish, and more of our dollars spent will go toward supporting Jersey’s incredible small businesses.”

That neatly summarises pretty much everything I’ve been saying for the last few years about the benefits of hybrid working: that is, close to or at home, with the occasional visit to the head office for brainstorming, meeting clients, training, or simply socialising.

What he doesn’t mention is the massive reduction in carbon dioxide emissions the move would also bring about, due to the unprecedented fall in car journeys that would be precipitated. Remember those pictures from 2020, when a 25% fall in global carbon dioxide emissions during lockdown resulted in cities that had been smog-bound for decades suddenly being able to enjoy stunningly clear air? These could once again become the norm.

A major shift in thinking

Gottheimer is just one of many influential people in the U.S., including those at the helm of businesses from Citigroup to United Airlines, Boeing to Facebook and Spotify, who are promoting the value of enabling their people to frequently work somewhere other than a big city center at the end of a long commute.

This shift in thinking is far from restricted to the U.S. and Rep. Gottheimer. At IWG, we have flexible workspace centers in more than 120 countries around the world, and this phenomenon is something we’re seeing literally everywhere. And this re-balancing away from big cities is by no means all down to the impact of the global Covid-19 pandemic, although this was clearly the catalyst or accelerant that’s pushed local thinking and hybrid working to the forefront of business – and sometimes political – thinking.

So while I’ve been predicting the rise of the hybrid model for most of this century, it’s only been in the last couple of years that it’s taken a firm foothold in the global real-estate landscape.

This has been timely. Previously, many of those smaller cities, towns and rural communities were facing an existential threat as many of their most energetic and economically active members shipped out to a distant city five days a week, returning only to rest before setting off again.

Irresistible force of change

You only have to look at the names and profiles of some of the towns in the US and the UK where we’ve recently opened new centers to get a sense of why people want to be there.

Kodak, Tenn., for example, population 10,500, and so christened in 1892 when the local postmaster decided it was a suitably memorable name. Or Destin, Fla., population 14,000, self-styled “The World’s Luckiest Fishing Village.” Or Bluffton, S.C., whose population of 27,716 has grown by more than 120% since 2010. Or, indeed, Middleton, Wis. (population 20,000); Ridgeland, Miss. (24,000); and Stafford, Va. (just 5,500).

There’s a similar picture in the U.K., where Gerrards Cross, Buckinghamshire (8,000 people, on the edge of the Chiltern Hills and well under an hour into central London), Chippenham, Wiltshire (with 45,000 people in the orbit of Bristol and Bath) and Marlow, Buckinghamshire (14,000 on the banks of the Thames) have all welcomed new IWG centers over the last year.

What all these places have in common is that they are great places to live, raise families, and socialise. And increasingly they’re becoming great places to work too. In fact, throughout 2022, the vast majority of our new centers have opened outside city centers. And this is just the most visible sign of a rapid reassessment of office real-estate values in small towns and local communities right across the world.

Reasons to be cheerful

It’s a force that’s rapidly redefining the geography of countries everywhere. More than that, it’s opening up opportunities for property owners to repurpose their assets into high-quality flexible workspaces, empowered by technology to meet the efficiency and productivity needs of workers and employers in many different industries and sectors.

There is a whole world of incredible potential out there, just waiting to be tapped. There are very real reasons for optimism, as leaders everywhere continue to endorse the concept.

The shift from the city center is more than just a win-win. It’s great for workers: their finances, their mental health and their personal relationships. It’s great for businesses, with much-reduced real-estate spend and heightened productivity. It’s great for communities and local economies everywhere. It’s great for the environment. And it’s great for property owners too.

It’s even great for those cities that can reinvent themselves as thriving patchworks of local communities, interlinked by excellent transport systems and promoting themselves as cultural and entertainment magnets.

I make that at least 10 wins. And that’s far too many for anybody to ignore.

Mark Dixon is founder and CEO of IWG plc.