ABSOLUTE OCCUPANCY COST
Absolute Occupancy Costs are being better understood by tenants in all asset classes – and the formula is far more interesting than rate/sqm x area. A recent study estimated office rental costs only equating to about 10% to staff costs! So a 1% improvement in staff productivity would be the equivalent of a 10% reduction in rent – something every business would aspire too.
We have already witnessed improvements around OPEX, car-parking and fit out costs. But this is only the first stage in the “AOC” revolution.
·Efficient design; businesses decreasing their footprint through interior design solutions
·Technology; increased flexibility and smarter systems meaning less requirement for physical space
·Talent attraction & retention; people choosing to work (or continue working) for companies lowering recruitment/churn costs
·Health & wellbeing; talent having less time off and being productive in the workplace
·Customer Experience; increasing revenues through offering a more rewarding journey for customers
·Brand presence; growing awareness of your brand resulting in positive brand recognition and lower advertising costs
By associating a monetary value to each of these factors, we can then better understand your physical real estate needs to match your overall business objectives. Be this reducing warehousing costs, increasing foot traffic or having a more engaged workforce – the benefits are there for you to adopt a more holistic view of your Workplace requirements.
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