After decades of corporate real estate location strategies designed to consolidate user groups under one roof, today more companies are using ‘multi-hub’ or ‘hub and spoke’ strategies, which offer a distinct advantage in today’s hyper-competitive labor market. While there are many benefits to being all together in one location, one drawback is that a company limits its labor pool to only those people within a reasonable commute of that location. When a company maintains multiple locations in the same region, it is effectively expanding the catchment area from which it can recruit employees. This is a distinct advantage in the current tight labor market, where every advantage must be exploited to gain a competitive edge in attracting and retaining the best employees.
With Greater Boston’s seasonally adjusted unemployment rate registering 2.8% in November 2018 (as compared to 3.7% nationwide), the region’s labor market is the tightest it has been in the last 18 years.
Some Boston-area tenants have been addressing talent shortfalls by establishing seed locations in other markets, such as Philadelphia for life science talent or Salt Lake City for financial and technical operations. While the idea is that hiring may be easier elsewhere, the reality is that there is not much relief to be found, with most talent-rich markets facing similarly high levels of competition for in-demand skill sets in software, life science and other booming industries.
In Greater Boston, multi-office footprint configurations with both an urban and a suburban locus point have been particularly valuable. The migration of companies from suburban to urban markets over the past business cycle has exacerbated the traffic and congestion concerns that some suburban residents voice as a reason not to work in the city.
In addition to sheer numbers, having both an urban and suburban location gives a company broader reach across the socioeconomic fabric of Greater Boston, offering access to more neighborhoods with varied incomes, education levels and skill sets.
While managing work across multiple offices is not a new or insignificant organizational challenge, the barriers to working across multiple locations have become lower. This is due in large part to evolutions in technology infrastructure and applications that support distributed work. These tools, along with generational shifts in the workplace, are leading to increasing acceptance of mobile work and teaming across office locations. While it can be a challenge to maintain culture across multiple locations and avoid a “haves vs. have-nots” dynamic when office locations have differing quality or amenity levels, it can be managed with proper foresight and planning.
Brian Cohen is a senior vice president with the CBRE/New England Consulting Group, Boston, Mass.