Large employers no longer ditching office space as hybrid working balance is achieved

Six years after the coronavirus pandemic hit the Netherlands, the large-scale reduction in office space seems to be coming to an end. Large employers have found a balance with hybrid working, and their office space is now designed to accommodate it, Financieele Dagblad reported after surveying 29 large office users, including municipalities, banks, and accounting and consulting firms.

In recent years, the majority of these office users have shed significant amounts of office space. In 2024, a majority of employers still indicated that they intended to downsize.

Now, the majority say they are satisfied with the capacity they currently have. 20 of the 29 employers have no plans to dispose of more office space. The main reason given is that their hybrid work policies have been successfully implemented, and they have the space they need.

Consulting firm Deloitte told FD it has a good balance between occupancy and square footage. Bank-insurer NN Group said its current office space is sufficient and its hybrid work policy is perceived positively. ING is seeing more employees returning to the office and does not expect to get rid of any additional square footage.

Five employers, including Achmea, NS, and PwC, are still reducing their office space. And a handful of companies are actually expanding.

Mirjam Bani, a real estate economist at ING, is not surprised that the wave of corporate downsizing is coming ot an end. “Many office leases have a term of around five years. Most major changes due to working from home have already occurred after the expiration of those leases,” she told FD.

According to Bani, many companies likely still have a little more office space than they would ideally like, but have to make the best of the available supply. “In recent years, office users have become more critical of the location and quality of offices, partly due to the tight labor market and sustainability requirements. Companies sometimes have to choose between the perfect number of square meters and a slightly oversized, but sustainable office in a prime location.”