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Episode 124

Facility Management & CRE Strategy for Return to Office and the Future Workplace

with Corrina Knight, MBA, CFM, FMP & Dougal Jeppe

Corrina Knight, MBA, CFM, FMP is Director of Global Facilities Operations at Red Hat where she provides strategic direction to the CRE team ensuring effective and efficient operations across Red Hat's global real estate portfolio. Dougal Jeppe is Executive Vice President and a Commercial Real Estate Advisor at Colliers International where he works to ensure a company’s real estate matches its business goals. Corrina and Dougal joined Mike Petrusky and his co-host Madison Dujka on a recent “Workplace Innovator Interactive Livestream” to discussed return to office strategies that put people first while they also explored how real estate and workplace trends are changing. This highlight episode offers valuable insights delivered during our weekly live broadcast happening every Wednesday at Noon ET.

Space-Right Safe Distancing Made Simple

Connect with Corrina on LinkedIn: https://www.linkedin.com/in/corrina-knight/

Connect with Dougal on LinkedIn: https://www.linkedin.com/in/dougaljeppe/

Listen to Dougal’s “Office Space Podcast”: https://podcasts.apple.com/us/podcast/the-office-space-podcast/id1513815593?uo=4

Watch the full livestream recording: https://www.iofficecorp.com/webinar-download-workplace-innovator-interactive-livestream23

View all past livestream recordings: https://www.iofficecorp.com/resources?type=livestreams

Discover free resources and explore past interviews at: https://www.workplaceinnovator.com/

Connect with Mike on LinkedIn: https://www.linkedin.com/in/mikepetrusky/

Share your thoughts with Mike via email: podcast@iOFFICECORP.com

Read the full transcript:

Mike P (00:01):

Hey, do you want more insightful conversations? Many of the topics we discuss here around workplace design and strategy are also explored in depth at Work Design Magazine. You'll find many of my past guests contributing to the site. Coming soon, I'll welcome publisher Bob Fox to the show. He'll talk about the winning submissions and the fascinating findings from the next Work Environment Competition. Be a workplace innovator and subscribe for free today at workdesign.com. Thanks.

Corinna Knight (00:36):

I think we're all in the middle of this right now. We're not quite to that place where we're like, "Okay, this is now where we're going to be."

Dougal Jeppe (00:44):

It's been amazing how each company's handling it a little bit differently, based on the information they're getting.

Mike P (00:51):

This is the Workplace Innovator Podcast, where we talk with corporate real estate and facility management leaders about the industry trends and technologies impacting your organization. This show is powered by iOFFICE, the leading employee experience focused IWMS software that delivers real-time data and mobile tools to help you intelligently manage your digital world.

         Hey, everybody. Welcome to episode 124 of the Workplace Innovator Podcast. I'm your host Mike P. As always, thank you for joining us. This week, we have another great conversation drawn from a recent Workplace Innovator interactive live stream, where we covered the topic of facility management and CRE strategy for the return to office and future workplace.

         My guests were Corinna Knight of Red Hat and Dougal Jeppe of Colliers International, two amazing guests with different perspectives. Corinna, as the director of global facilities operations, was giving us the end user perspective, while Dougal, in his role as a commercial real estate advisor, was able to share some of the trends in the world of real estate, as he works with tenants and building owners. We talked for an hour. There was so much great information shared, I want to get to as much of it as possible. So here we go.

         Everybody out there, hi. Welcome to the Workplace Innovator interactive live stream. I'm Mike. This is my co-host, Maddie. We're here for each other, and we want to get everybody through this. So whether it's a hurricane approaching, or just dealing with the threats of a pandemic, or trying to plan for the future of the workplace, we're here for each other. That's what this community is all about.

         We like to have a little fun on the show. We hope this hour is, yes, informative. We also hope it's inspirational a little bit and entertaining, I'll say. With that said, let's welcome in our two great guests. I'm excited to introduce you all. I'll first welcome, from Raleigh, North Carolina, Corinna Knight. Hi, Corinna.

Corinna Knight (03:00):

Hi. Thanks for having me today.

Mike P (03:02):

Good to see you again. It's been about five months. You were the last, I think, person I saw in person, during an IFMA event. It was in Charlotte. I had a chance to speak to that crowd. We had a wonderful time. You were on a panel too. You shared your knowledge as a director of global facilities and operations at Red Hat. Tell us a little bit more about what you do for Red Hat and at IFMA.

Corinna Knight (03:24):

Yeah, absolutely. First, thanks for having me. Super excited to be here. Did have the pleasure of meeting Mike back in March, early March, and was really right on the cusp of this huge change that's happening for us right now.

         I do. I oversee facilities operations at Red Hat. It's part of our corporate real estate organization. We have about 120 offices around the world. We just have been moving through things like everybody else, and learning from our experiences and learning from others. Happy to be here today and share that with you guys.

Mike P (03:59):

We are glad to have you, and look forward to your insight and understanding of all the things that are going on, and how you're going to be able to help our audience better prepare. I know that FMs love to hear from fellow practitioners about what's going on in their world. In fact, I was just on an FM round table with my local capital chapter of IFMA yesterday, and it was a great discussion. I'm going to share some of those thoughts that I heard.

         But joining us today with commercial and corporate real estate expertise, and someone who I just was introduced to about a month or two ago, was it, Dougal? Dougal Jeppe ... Kate North, a fellow friend from the IFMA workplace evolutionaries community, and a past guest on my podcast, Kate introduced us, Dougal. Why does she do that? What was Kate thinking? Why would we have something in common?

Dougal Jeppe (04:46):

I've got something called The Office Space Podcast. She said, "You have to connect with Mike. He really knows his stuff, and he's done great things with his podcast and his social media efforts."

Mike P (04:57):

Cool. Well, I was excited to hear about that. I've listened to a few of your episodes. Tell us a little bit more about what you do for Colliers, and what you've been talking about on The Office Space Podcast.

Dougal Jeppe (05:08):

Yeah. I represent corporations for their corporate real estate. I'm based out of Chicago. A lot of our business is based out of Chicago, but we do work all over the globe for a handful of clients. There's no real industry specific, so we see a lot of different users, and we get a pretty good taste of what people are thinking right now in the market.

         Kate North, the workplace strategy has been part of the discussion for many years, but it really has become front and center on a lot of discussions right now. These are just interesting times, and we're trying to advise our clients accordingly.

Mike P (05:45):

Awesome. Well, glad to have you as well. I like to kick things off with a few fun poll questions. This is something I borrowed from my local IFMA chapter. When we get together for happy hours, we do this or that poll questions just to set the tone and have a little fun together.

         It's been a tough week, Maddie. I didn't tell you this, but I've had a tough week, and I've kind of escaped with music and my 80s references. I found this recent release on Netflix about video games, the origin of video games in the 80s. So my first poll question is inspired by this documentary I saw.

         I love classic video games. I grew up putting quarters of machines in the arcade at the Jersey shore. If you had to choose one classic arcade video game, would it be Pac-Man or Donkey Kong? Corinna, I got to think you played both these games growing up. Didn't you?

Corinna Knight (06:36):

Did, yeah. Can I go Ms. Pac-Man on that one? I think [crosstalk 00:06:39]

Mike P (06:38):

Yes. Okay.

Corinna Knight (06:41):

I'm going to go rogue and add one to the list there.

Mike P (06:43):

Next level Pac-Man. I love it. There's actually a story on that documentary I'll tell you about later about the origins of Ms. Pac-Man. But Dougal, how about you? Were you a video game kid?

Dougal Jeppe (06:53):

Yeah, I'm going to go with Pac-Man. In its simplicity, it was a beautiful game.

Mike P (06:58):

Awesome. Well, I'm a Donkey Kong fan. Looks like you Pac-Man players, (singing), 75% beat us out, but I loved Plumber Man, who became Mario. I don't know if you all knew that, but he was originally known as Plumber Man. He rescued the princess from Donkey Kong.

         All right, next question. We got to move this along. Classic board game edition. All right. We're going to put the video games aside for a second and talk about some of the most popular board games of all time. Maddie, I didn't ask you, but I'll ask you this question first: Monopoly or Scrapple? Scrapple. Scrabble.

Maddie (07:30):

Monopoly.

Mike P (07:31):

I'm thinking of Jersey shore. Does anybody know what scrapple is?

Maddie (07:35):

I love Monopoly. I don't.

Mike P (07:36):

Okay. I love scrapple too. We'll talk about that later. Monopoly. Corinna, how about you?

Corinna Knight (07:42):

I'm going to go neither.

Mike P (07:47):

But you have to choose. Were going to force you to choose.

Corinna Knight (07:50):

Monopoly, Monopoly. All right, Monopoly.

Mike P (07:51):

Dougal?

Dougal Jeppe (07:52):

Scrabble. I don't have the patience for Monopoly. It turns into a four-hour game.

Mike P (07:55):

I was going to say, has anyone ever finished a game of Monopoly? I don't think they have. That's not possible.

         Everybody has their different experiences and perspectives. Certainly that's the case in the world in which we're operating today, living with COVID-19, and now our decisions, individually, about returning to offices, and as organizations about returning to offices.

         But I think, Corinna, I'm going to ask you first about your experience at Red Hat and decision making around the return to office. How do you even begin to approach this very complex problem?

Corinna Knight (08:29):

Yeah, it has been quite the journey for sure. One of the things that I've been really fortunate about, just about Red Hat in general is we're a highly collaborative organization. So right from the beginning, we formed what we refer to as the CIMT, or a critical incident management team, of just procurement, corporate real estate, IT, HR. That really, for us and leaders from those teams coming together each week to say, "Okay, where are we at?"

         At first, it was just about closing the offices. It was about, "Okay, we've got to shut this down. Now we're going to move into North America. We're going to be shutting that down." Then it was all about, "Okay, where do we go from here?" Quickly, we just pulled together as a team, and really started talking through the pieces of what needs to happen.

         Of course, my part, return to office, pulled a great team together globally. I've got about 125 people around the world and a really great management team. Those associates really band together and started thinking through, "Okay, what do we need to do, and what are our priorities?" For us, at Red Hat, the priorities are really our people first and foremost, safety, absolutely at the top, and the needs of the business. What do we need to continue to make Red Hat great?

         All of those pieces came together. Then we started looking at how do you do that, and creating dashboards and resource guides to really help everyone align globally on how to get back.

Mike P (09:59):

Where are you today, in just a summary. I know it's different in Europe and Asia than it is here in the North American region, but can you give me just a quick synopsis of maybe percentages of folks who are back to the office, and what the future might look like?

Corinna Knight (10:12):

We have, of our 120 plus offices around the world, we have about 28 of those that are open now. Those are actually in our APAC and our AMEA regions. We've actually got a couple on the radar to open in North America in the next couple weeks.

         It's a very fluid process that we go through, really at the top being our people and our safety and movement gating criteria, but we've got some offices open. That was a huge relief. We're actually going into, I think this is week four. We've had a few offices in our APAC and EMEA region open now for a month. That's been really, really good, to know that we made it there, and that we made it there successfully, and that things are going smoothly.

Mike P (10:53):

Excellent. I'll dig more into those details here in a moment. But Dougal, what are you hearing as far as your client base, tenants, building owners? Where do people stand, in general terms, from your perspective?

Dougal Jeppe (11:06):

Yeah. I would say we have a monthly call with folks that do what I do from all over the globe. We were having that actually every other week at the beginning of this. We were getting data from Asia, as they were further ahead of us and things of that nature, and trying to monitor that as much as we can.

         But really no size fits all. It's been amazing how each company's handling it a little bit differently, based upon the information they're getting, based upon, quite frankly, the leadership from top down. Then you have liability issues too that people are now considering.

         So it depends. I'm seeing companies that I thought, a month ago, were going to start reentering the workplace come after Labor Day. Now I would say 90 to 95% of our clients here in the United States are planning on working from home through the rest of the year.

Mike P (12:01):

Wow.

Dougal Jeppe (12:01):

In some cases, we're finding leaders that ... In a city like Chicago, as an example, where we've had some very tough times right now, with the rioting and the protests and everything like that, here's a bit of a movement towards ... It's almost like as a pride. We're going to come back to the office to help retail, help restaurants, help Chicago lift up. So there's a bit of a movement in that regards.

         You can't force people to come into the office, so people are coming up with creative ways to encourage some people to come in the office. In summary, it depends on the company.

Mike P (12:37):

Yeah. That's an interesting concept. It's something that I've been thinking about a lot, Dougal. I want to hear more about that idea of our responsibility in society. As many of you probably can suspect, those out there in our audience, we're all doing pretty well.

         Most of us, not all of us, can work from home effectively, have the ability to have patience when it comes to the pandemic. Many organizations that we talked to here on the show are obviously in the world of knowledge work and technology, and we have the tools to do what we do. But a big, big part of our society doesn't have that privilege.

         Also, I've just been reading. Did you all see the articles about New York City and went viral on LinkedIn? I can't remember the guy's name, but there's an article on LinkedIn that went viral about New York City is dead. He gave this very long list of reasons why the big city will never be the same.

         Then interestingly enough, the next day, Jerry Seinfeld, who's a big New Yorker ... I'm a big fan of his. He came back with a very brief opinion piece in the New York Times that said, "Forget it. It's not dead. New York will always bounce back. It always has. It always will. I will never leave New York."

         But to your point, Dougal, what is our responsibility, as corporate citizens and people in leadership, to get beyond our maybe personal feelings about comfort and being in our little bubbles, and thinking about others and all those businesses that we support? Because if the restaurants and all the other businesses that are out there, all the support and services aren't able to make a living, we can't really enjoy our experience as knowledge workers. Do you have any more thoughts on that? What have you heard that can help us get through this challenge?

Dougal Jeppe (14:18):

Well, we're all beholden to stakeholders of our business. There's the greater good and then there's what's good for your business. But I think there seems to be a little bit more of a movement towards that.

         Yeah, I love the Jerry Seinfeld response. I thought it was great. It was bold. He got some flack, because he dissed on Florida a little bit, but that's very New York, to think that that's the center of the universe.

         But I heard Sam Zell on CNBC this morning. Now of course, he's promoting people coming back in the office, because his interests are in office space. But he's suggesting that there's more leaders that should be stepping up and trying to get people to come back and be together.

         Now, if it's not safe, no one's going to do it. I personally don't think, until there's a vaccine, companies aren't going to put that liability. Certainly landlords aren't going to take liability on that. So I think there's a movement, but until there's a time for true safety and wellness, that probably won't happen in any significant degree.

Mike P (15:21):

Yeah. Corinna, that's something I want to ask you about. Is that part of the conversation, this ... When I think of health and safety, we're talking about keeping ourselves safe from the virus, first and foremost, the physical safety, and return to the office seems to be like, "Well, just shut it down and don't return." But what about the mental health and the wellbeing of people as they have trouble with their individual circumstances working from home? I'm sure it all comes into play when you're discussing this, right?

Corinna Knight (15:44):

Yeah. That was one of, really, our main drivers around return to office initially. Here in North America, we have one perspective. Many of us have conditions where we have extra spaces, or the conditions that are really conducive to productivity and working, but that's just not necessarily the case around the world.

         One of our main drivers, which was really driven out of our HR organization, was really making sure that associates had a way to be accommodated when those conditions didn't exist. Even early on, the discussions were really around how can we get those people back into a safe environment, where they can be productive, and they can have what they need to get their work done. It's been a huge consideration and part of our return.

         The return that we have had, even though our numbers, some offices might've had 50 people slated to return, we've seen much smaller numbers actually returning, but we do believe that a lot of those associates are those people who really need that environment, and really need that environment to work and work successfully.

Mike P (16:45):

Maddie, I'm sure you're getting inundated with comments and questions, but is there one that rises up that ties into what we were just talking about?

Maddie (16:51):

We do have a lot of questions, actually. This first one is for Dougal. Do you see many of your clients planning to move out of big cities and big office spaces or campuses, and planning to move to smaller cities and smaller office spaces in a distributed workplace?

Mike P (17:08):

There you go, the Jerry Seinfeld and LinkedIn article again.

Dougal Jeppe (17:11):

Yeah. Big question. We're talking to a lot of people about it. We're looking at labor in certain markets. There's logistical challenges to managing disparate offices, but then there's cost savings and lower cost market sort of thing. So we're hearing more, and we're discussing more of the hub and spoke model, which is one centralized location, and then different locations where you can accommodate people in their markets where they live. That's absolutely happening. Then there's a shrinking of the headquarters space, at least discussion of it.

Mike P (17:44):

Corinna, do you have any thoughts on that? Have you guys been discussing any major moves?

Corinna Knight (17:48):

Yeah, no. At the moment, from a portfolio perspective, we're still looking at what this will be long term. I think for us it's a little premature. We're 100% lease portfolio. We've gotten great spread globally, both in actual Red Hat offices, as well as the managed service environment. So we're definitely looking at things that might be coming up from a lease expiration perspective or contract ending perspective. But we're definitely ...

         I think we're all in the middle of this right now. We're not quite to that place where we're like, "Okay, this is now where we're going to be." So for us, we're really holding and looking at trying to understand more about what the demand will be. We've got a great survey that's going to be going out to associates, to understand more about how they feel about demand in the near future. But we really, at this point, we're not drawing any hard decisions or making any hard conclusions on that.

Mike P (18:48):

There you have it, folks. Corinna Knight of Red Hat and Dougal Jeppe of Colliers sharing just a few thoughts, and answering many of your questions, on last week's Workplace Innovator interactive live stream. I wanted to get this one out to you right away. So much timely information was shared.

         In fact, we went on to discuss even more around technology tools that might help with the return to office, air monitoring, space utilization and room booking, which of course will be a priority in the future world of the hybrid approach to the office. We discussed co-working and leadership styles, as well as shorter term, flexible leases. So much good stuff.

         I, of course, encourage you to check out the complete one hour video recording, where you can see our faces, and enjoy the entire time we had together, including Maddie and I, as we share our escape from reality recommendations. I hope you'll think about joining us live on future broadcasts. Check out www.workplaceinnovator.com for all the details.

         Until then, I look forward to catching up with you each and every week here, as we encourage and inspire each other to be a workplace innovator. Peace out.

         You've been listening to the Workplace Innovator Podcast. I hope you found this discussion beneficial as we work together to build partnerships that lead to innovative workplace solutions. For more information about how iOFFICE can help you create an employee-centric workspace by delivering digital technology that enhances the employee experience, visit iofficecorp.com.