Urban Pulse or Suburban Ease: Unveiling the Future of Office Locations

Hannah Salzberger and Tobias Just

ERES from European Real Estate Society (ERES)

Abstract: Following the Covid-19 pandemic, the future of office buildings has become a popular topic, heightened by the pervasive adoption of the work-from-home model. As remote work transitions from being a rare obscurity to a part of daily routines, the spatial dynamics of office locations undergo a profound reassessment in terms of cost-benefit analysis for central and peripheral office space. This research presents a model that illustrates the optimal or minimum aggregated travel cost location based on distinct working modes. Initially, a city model is introduced, operating on the premise that individuals prioritize proximity to their workplace. The central focus revolves around the dichotomy between central business districts (CBD) and peripheral office locations, envisioning at first a monocentric city with higher population density near the CBD. This framework compares aggregated commuting costs to the CBD against those associated with travel to peripheral office locations. Subsequently, four satellite office locations are evaluated in relation to the Central Business District (CBD) based on their aggregated commuting costs. The analysis distinguishes between two distinct working models: team-dependent tasks and tasks that can be performed independently, suggesting a transformative shift in the role of office spaces towards collaborative hubs on the one hand and traditional space facilitating single-desk office work. A simulation is employed to vary team sizes, determining whether, for each size and working model, offices are better situated in the city center or on the outskirts. By contributing to the ongoing discourse on the evolution of office spaces, this study aims to provide valuable insights into the optimal office location based on commuting costs, considering the nature of collaborative and individual work models.

Keywords: Aggregated travel costs; Monocentric city model; Office location; Spatial Allocation (search for similar items in EconPapers)
JEL-codes: R3 (search for similar items in EconPapers)
Date: 2024-01-01
New Economics Papers: this item is included in nep-tre and nep-ure
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