Xymax Real Estate Institute

TOPIC REPORT

Reconsidering How to Assess Office Space Due to theCOVID-19 Pandemic (2022)
Higher coming-to-office ratio, fewer number of desks per worker coming
to the office

March 14, 2023

The COVID-19 pandemic has brought about drastic changes to work styles and workplaces, and how weuse the workplace is also beginning to change significantly as a result. Under these circumstances,companies are faced with the need to reconsider the workplace and reassess the conventional office space.
While companies have traditionally assessed their necessary office space based on the number of officeoccupants, it has become difficult to manage office space based on the number of people, as the numberof office users has become fluid due to the advent of the coming-to-office ratio. Companies are also
starting to introduce flexible desks and seats such as hot-desking and sofa seats as desks and seatsavailable for work, in addition to fixed desks. Office space is beginning to be assessed based on the“number of desks” that takes into account the coming-to-office ratio.*1
In this report, Xymax Real Estate Institute (“Xymax REI”) considers how to assess office space by analyzing
the relationship between the “number of people” and the “number of desks” in consideration of thesituation and percentage of workers coming to the office of companies located in the 23 wards of Tokyo(“Tokyo 23 Wards”) based on the results of the Metropolitan Areas Office Demand Survey*2 conducted byXymax REI in April and October 2022.
*1 Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic, released on December 14, 2021
https://www.xymax.co.jp/english/research/images/pdf/20211214.pdf*2 Metropolitan Areas Office Demand Survey Spring 2022- (1) Demand Trends, released on June 15, 2022
https://www.xymax.co.jp/english/research/images/pdf/20220615_1.pdf
Metropolitan Areas Office Demand Survey Autumn 2022- (1) Demand Trends, released on December 15, 2022
https://www.xymax.co.jp/english/research/images/pdf/20221215_1.pdf

Examining the relationship between the “coming-to-officeratio” and the “number of desks”
As workers return to the office, the number of desks per worker coming to theoffice decreases.
Figure 1 shows the coming-to-office ratio and number of desks per worker coming to the office ofcompanies located in the Tokyo 23 Wards.
According to the company survey Xymax REI conducts on a continuous basis, the actual coming-tooffice ratio averaged 62.9% at the time of the 2022 survey, a 3-point rise from April 2021. The report
showed that while hybrid work has taken root, workers were gradually returning to the office in 2022.
Due to the increase in the number of workers coming to the office, the median number of desks per
worker coming to the office was 1.67 in 2022, a decrease from the previous year. Possible factors for thedrop in the number of desks per worker coming to the office other than the increase in the number ofworkers coming to the office include efforts to reduce the number of desks to a practical number on theback of a decline in the number of office users due to the progress in telework.

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

1TOPIC REPORT｜Xymax Real Estate Institute
Figure 1: Coming-to-office Ratio and Number of Desks per Worker Coming to the Office(As of the 2021 and 2022 Surveys)

Number of desks per worker coming to the office
Figure 2 shows the distribution of the number of desks per worker coming to the office at the time ofthe 2022 survey. As the distribution indicates, the number of desks provided for the number of workers
coming to the office currently varies significantly among companies. The fact that the largest percentageof companies (21%) provide more than 3 desks per worker coming to the office, in contrast to the medianvalue of 1.67 desks, suggests that there may be a surplus of desks due to the delay to make adjustments
to the number of desks provided based on the conventional number of office occupants.
Figure 2: Distribution of Number of Desks per Worker Coming to the Office(As of the 2022 Survey; n=1,010)

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

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TOPIC REPORT｜Xymax Real Estate Institute
The number of desks per worker coming to the office may continue to decrease
In the 2022 company survey, companies’ intended post-pandemic coming-to-office ratio averaged
68.5%, 5.6 points more than the actual performance of 62.9%, indicating that workers’ return to the office
may see further progress. Note that companies’ intended post-pandemic coming-to-office ratio has beensteady at 65%–70% since the 2020 survey.
When we look at companies’ intended number of desks per worker coming to the office in light of thesecircumstances, the median value is 1.18 desks, which indicates that the general trend among companies isto reduce the number of desks per worker coming to the office in line with companies’ office attendance
policies (Figure 3).
Figure 3: Number of Desks per Worker Coming to the Office(Actual Figure in 2022 and Future Intention)

Furthermore, when we look at the intended number of desks per worker coming to the office by thepost-pandemic coming-to-office ratio, we can see that companies with a lower coming-to-office ratio tend
to have more desks per worker coming to the office (Figure 4). Companies with an intended coming-tooffice ratio of less than 60%, in particular, are likely to seek to reduce the number of desks going forward
as there is a gap between the actual performance and the intention.
Figure 4: Number of Desks per Worker Coming to the Office by the Intended Coming-to-office Ratio(Actual Figure in 2022 and Future Intention)

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

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TOPIC REPORT｜Xymax Real Estate Institute<Reference> Office Space per Desk (2022)
Figure 5 is the distribution of office space per desk calculated from companies’ leased space and numberof desks in their office as reported in the 2022 survey. The median value in 2022 was 2.88 tsubo per desk,
which is not significantly different from the 2021 survey*1 (2.86 tsubo/desk).
As for the distribution of office space per desk, a majority of the replies were concentrated between 2and 4 tsubo. On the other hand, we also found that a little less than 10% of the companies had more than
6 tsubo per desk.
*1Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic, released on December 14, 2021
https://www.xymax.co.jp/english/research/images/pdf/20211214.pdf

Figure 5: Office Space per Desk (2022; n=1,019)

For reference, “office space per desk” multiplied by the aforementioned “number of desks per worker
coming to the office” yields “office space per worker coming to the office.”

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not bereproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

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TOPIC REPORT｜Xymax Real Estate InstituteOffice space after the COVID-19 pandemic
These analyses suggest that the number of desks relative to the number of workers coming to the office
may be reduced from the current number in general. However, will office space also be reduced as a result?
According to the company survey conducted by Xymax REI on a continuous basis to understand the actual
state and future direction of office demand, it is inferred that the possible directions of office space are notuniform, but are likely to be diverse as the following scenarios, as companies diversify their workplacestrategies by promoting the introduction of ABW (Activity Based Working) and hybrid work, in which
employees can choose where to work at their discretion according to their various duties.

 Reduce office space in accordance with the drop in coming-to-office ratio
Moves to reduce the number of desks in accordance with the drop in coming-to-office ratio tostreamline the space of the main office have been seen since immediately after the outbreak of thepandemic. As many companies intend to continue to embrace telework, we expect to see acontinued trend of increasing flexibility and reducing office space.

 Expand office space due to an increase in personnel and a rise in the coming-tooffice ratio
It is likely that more companies will try to secure larger office space in order to respond to a rise in
the number of office users going forward due to a future increase in personnel and a further returnto the office toward the end of the pandemic.

 Redesign the main office by introducing various types of space
In order to promote a hybrid work style, more companies are aiming to add more value and give aclearer purpose to their main office by adding or reinforcing space for enhancing the featuresunique to the main office. By introducing a variety of office layouts other than the conventional work
desk, these companies may not reduce the total size of their main office but may expand in somecases even if they reduce the number of work desks.

 Provide more places for work other than the main office or the home due to thepromotion of hybrid work
Due to the spread of telework, there is a growing trend toward diversifying the place for work otherthan the main office by introducing a work-from-home program and providing satellite offices. This
trend is expected to progress further in the future.

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not bereproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

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TOPIC REPORT｜Xymax Real Estate InstituteSurvey Overview
 Metropolitan Areas Office Demand Survey Spring 2022 (Survey period: April 2022)
 Metropolitan Areas Office Demand Survey Autumn 2022 (Survey period: October 2022)
Original data

After processing the duplicate data of the Spring 2022 and Autumn 2022 surveys and thenaggregating them, the data with no missing answers to be used in the analyses were subject to theanalyses.

Targetrespondents
Number ofvalid answers

Of general office tenants occupying office buildings in the Tokyo 23 Wards, those with an office space
per office occupant of at least 0.5 tsubo but less than 15 tsubo

1,019
 “Space” refers to the contractual leased space. It includes office space, entrance (reception) area,
meeting rooms, break rooms, libraries, storage rooms and enclosed hallways of private areas.
 “Number of office occupants” refers the number of employees who are eligible to use the officethough may not be using it every day.
 “Coming-to-office ratio” is the company’s current average percentage of employees coming to theoffice and the intended percentage after the end of the pandemic, with 100% meaning all employees
come to the office.
 “Number of workers coming to the office” refers the average number of workers coming to the office

Remarks

at the time of the survey.
 “Desks” refer to work desks in the main office where respondents replied that general work can bedone. They include fixed desks (e.g., islands of opposing desks, cubicles), hot-desking, group hotdesking, desks in open meeting space, focus booths and private rooms (e.g., for making phone calls
and holding online meetings), canteens and café space, space for refreshing and space for external
collaboration. They do not include desks in meeting rooms (for small to large groups),
president/executive rooms, reception areas, libraries and storage rooms, changing/locker rooms,
server rooms, smoking rooms, day care space, show rooms and event space.
 “Number of desks per worker coming to the office” is an indicator referring to the number of desks
per worker coming to the office.

The percentage mix in the charts contained in this report are rounded to the first decimal place and therefore may not add up to 100%.

For further inquiries please contact below
Xymax Real Estate Institutehttps://soken.xymax.co.jp | E-MAIL: info-rei@xymax.co.jp

TOPIC REPORT: Reconsidering How to Assess Office Space Due to the COVID-19 Pandemic (2022)
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2023 Xymax Real Estate Institute Corporation. All rights reserved.

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