Top 10 Global

CRE Trends 2023

JLL Work Dynamics Research

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Global Corporate Real Key global macro factors organizations face:
Estate Trends in 2023
Thriving through uncertainty

The global economic outlook is challenging Labor shortage Rising costs

Organizations face a confluence of headwinds that are Labor markets were tight before covid and Energy, construction materials, food, rent,
impacting growth, costs, supply chains, and the ability have tightened further in the rebound. wages and debt costs are all rising,
to plan. Understandably, businesses will be more Travel and migration disruption is feeding, and being accelerated by, high
cautious and may consider reviewing their exacerbating problems filling vacancies, inflation. While inflation is expected to fall,
CRE strategy in light of the current operating and skills shortages abound. price levels are likely to remain high.
environment.

Business success lies in staying ahead of

the curve through thoughtful real estate
management Supply chain Energy crisis
Corporates will need to revisit their CRE strategies and The war in Ukraine, sanctions and China’s The energy crisis is foremost a cost
invest in solutions that enable continuous adaptation to recent zero-Covid policy have increased problem, driving up energy expenses
rapidly changing market dynamics. A careful balancing
supply chain and logistics disruption and several fold. But risks to availability are
of effective cost management whilst not compromising uncertainty. Costs are up, and so are lead rising, affecting the certainty of supply.
on quality and workplace transformation will be crucial.
times, impacting the ability to plan, price Europe is the most acutely affect, but the
and deliver projects. Americas are not immune.

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Top 10 global CRE trends in 2023

Hybrid Optimize Dynamic Data Holistic

reality with impact operations maturity wellbeing
Aligning spaces, Balance the risk of Implement digital Data maturity will Wellbeing will need to
technology and HR policies losing key talent against technologies that drive help generate be inclusive, holistic,
will be imperative to short-term cost and operational efficiency and sophisticated performance and personalized to
operationalizing hybrid portfolio efficiencies deliver return on insights and enable enhance workforce
investment dynamic decision-making resilience and performance

Connected Climate Responsible Redefined Innovation

communities resilience procurement partnerships clusters
Location decisions will Maintaining momentum on Bring positive and Organizations will form Organizations will prioritize
gravitate towards places actions will be critical to sustainable change by strategic alliances and markets with the strongest
where people can support net zero ambitions taking ethical and partnerships to tackle new innovation and talent
socialize, shop, live, work and future-proof sustainable considerations challenges and solve characteristics
and eat businesses when sourcing services, complex problems
supplies, and/or works

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Hybrid of corporates consider operationalizing hybrid work models to

reality
56% support agility and flexibility a top priority between now and 2025
Source: JLL Future of Work Survey, 2022

Hybrid is now a
non-negotiable element Space Technology Policy
of the workplace
ecosystem 60% 47% 53%
of office workers of corporates already have of organizations plan to make
want to work in a remote working technology in remote working permanently
hybrid style place, another 44% plan to available to all employees by
implement it over the next 3 years 2025
Source: JLL Future of Work Survey, 2022 Source: JLL Future of Work Survey, 2022
24% 24%
Office + Home Office + Home +

Aligning spaces,
Third place
60% 58%
of employees expect to be of employees expect to be
technology, and HR 10% 3% supported with remote-working supported with financial
policies will be imperative Home + Third Office + Third technologies assistance for expenses
place place linked to remote work
to operationalizing hybrid
Source: JLL Workforce Preferences Barometer, 2022 Source: JLL Workforce Preferences Barometer, 2022 Source: JLL Workforce Preferences Barometer, 2022

Learn from the experiences and experiments of the past and reconfigure spaces,
implement tech solutions and align HR policies to embed a hybrid environment
4 | © 2023 Jones Lang LaSalle IP, Inc. All rights reserved. that is agile and effective
Optimize 67% 75% 50%
of CFOs recognize “Identifying of employers globally report of office workers have left their
with impact cost optimization and
productivity opportunities” as
difficulty finding the talent
they need in 2022 – this is a
job since the start of the
pandemic, 90% of them would
a high priority 16-year-high consider moving jobs again in
the next 12 months
Optimizing investments
Source: WNS Global CFO Survey, 2022 Source: ManpowerGroup Employment Outlook Source: JLL A new employee value proposition, 2022
with a long-term Survey, 2022

‘people-first’ mindset
CRE leaders are revisiting portfolio strategy in light of current market conditions,
business objectives and workforce preferences
46%

42%
40%

Balance the risk of losing Workplace design to improve Increase the amount of flex Managing space demand
employee engagement and space in the portfolio dynamically
key talent against short- wellbeing
term cost and portfolio Q: Does your CRE function plan to accelerate investment in each of the following areas between now and 2025?
efficiencies Source: JLL Future of Work Survey, 2022

Reallocate capital and prioritize investment to optimize costs, meet stakeholders’

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expectations and attract and retain talent
Dynamic
70% CEOs believe advanced technologies can help
operations of CFOs recognize “implementing increase competitiveness
digital technologies to improve
efficiency, effectiveness, and Accelerate intelligent insights 63%
Transforming operations stakeholder experience” as their
Improve decision making and provide
and driving resilience in top priority clarity on outcomes 53%
Source: WNS Global CFO Survey, 2022
an agile world
Speed to execution 50%

53% Reduce costs 48%

of corporates consider improving
operational efficiency and Increase focus on customer/ consumer,
40%
supplier, and employee experience
portfolio resilience a top priority
between now and 2025 Fuel innovation 34%
Source: JLL Future of Work Survey, 2022

Fortify trust with customers/ consumers/

18%
suppliers
Implement digital 56%
technologies that drive plan to implement technologies to Q: What are the top ways you believe AI can help differentiate your
enable predictive management and organization and increase your competitiveness in the marketplace? (top 3)?
operational efficiency Source: Fortune/Deloitte CEO Survey, Fall 2022
maintenance of building systems
and deliver return on this year or next three years
investment Source: JLL Future of Work Survey, 2022

Leverage advanced technologies to manage operations dynamically on a daily/weekly

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basis to drive efficiencies and adapt quickly to continuous change
 Harness the power of data to enable decision-making
Data Current state Future state
maturity Periodic data collection Periodic data collection
Continuous, real-time data Only 13%
collection are collecting data on an
Backward-looking, A mix of past, present and future measures. Including
ongoing or real-time basis and
Backward-looking,
Improved and increased retrospective retrospective forward-looking, anticipatory, predictive ones leveraging advanced forms of
analysis
data capabilities, Source: JLL Future of Work Survey, 2022
Learning
Learning too little, too late too little, too late Responsive, agile, adaptable
insights and analytics
Simplistic metrics
Simplistic metrics Metrics harness varied data and advanced analytics
43%
plan to accelerate investment
Encompasses a broad range of financial
Largely
Largely financial financial measures
measures
and non-financial measures
in leveraging data and
analytics to enable real-time
Disconnected from wider strategy Aligned with strategic aims and objectives
decision-making
Disconnected from wider strategy
Source: JLL Future of Work Survey, 2022

Metrics
Metrics viewed
viewed as efficiencies
as efficiencies and and Metrics used to drive transformation,
‘numbers to hit’ ‘numbers to hit’ enable change and track value creation
Data maturity will help 56%
Metrics based aroundbased
Metrics stakeholders’
around Metrics based on the needs of employees and already introduced or plan to
generate sophisticated needs stakeholders’ needs other stakeholders as well as shareholders
introduce data science and
performance insights Inconsistencies in data availability, collection,
Consistencies achieved with statistical modelling by the
and enable dynamic standardized metrics and clear data end of this year
analysis & integrity limit usability
governance practice Source: JLL Future of Work Survey, 2022
decision-making Source: JLL Metrics that Matter, 2022

Double down on data and technology investment and build maturity in reporting of
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real estate data and better facilitate decision making
Holistic believe that improving the Burned out employees feel far less connected

wellbeing 41% well-being of employees is

a driver of D&I action
to their companies and report being
more “likely” or “very likely” to look for
Source: International Labour Organization, Transforming
3X a new job in the coming year
enterprises through diversity and inclusion, 2022 Source: Future Forum Pulse, 2022
An all-encompassing
approach that combines
social, physical and
Holistic Wellbeing
mental wellbeing
Social Physical Mental
Create workplaces that enable Create healthy spaces and empower Organize work in a way that
collaboration, socialization and give workforce with opportunities for encourages employees to actively
people a sense of belonging. physical activity, nutrition and pursue personal resiliency and
recovery. allows people to flourish.

49% already implemented inclusive 43% plan to accelerate investment 38% of employees are stressed
workplace design, another 33% in new or enhanced health and because of their workload and
plan to implement by 2026 wellbeing amenities overwhelmed by a huge mental
Wellbeing will need to Source: JLL Responsible Real Estate: Social Source: JLL Future of Work Survey, 2022 burden
be inclusive, holistic, and Value, 2023 Source: JLL A New Employee Value
Proposition, 2022
personalized to enhance
workforce resilience and
performance

Address wellbeing holistically to help improve workforce resilience, engagement and

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drive long-term business success
 Changing workforce and consumer preferences, sustainability pressures and the
Connected transformation of real estate by technology are forcing a ‘reimagination of CBDs’ and
the selective ‘urbanization of suburbia’.
communities
Top 10 considerations for location selection at a Characteristics of dynamic
Multi-functional, neighborhood level city districts
live-work-play Availability and quality of green spaces
and nature 49% Connected
communities
Safety and security of the neighborhood 48% Good density
Strong connection to local community 44% High amenity
Affordability of the neighborhood 42%
Vibrant
Good transport links 39%
Mixed-use
Green / EV transport infrastructure 38%
Flexible and adaptable spaces
Local healthcare facilities 37%
Sustainable and resilient
A wide variety of local amenities 37%
Location decisions will
Public realm investment
gravitate towards places Air quality within the neighborhood 37%
where people can A diverse community 37%
Innovative and collaborative
socialize, shop, live, work Q. In your opinion, which five of the following considerations would create
and eat higher social impact at a neighborhood level?
Source: JLL Responsible Real Estate: Social Value, 2023

Increase the attractiveness of your organization by considering locations that offer

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elements of high energy districts and flight to quality
Climate Energy-related emissions from the operation of buildings in 2021 were 5% higher than 2020
levels and 2% more than the pre-pandemic peak in 2019. Operational energy demand in
resilience buildings for heating, cooling, lighting and equipment rose about 4% from 2020 levels.
Source: Global Alliance for Buildings and Construction, 2022

Adapting and
transforming towards Actions to address energy and emissions in the built environment
a carbon neutral Reduce operational energy use Improve ‘green ratio’
built environment
By 2025, 90% of CRE leaders will be 74% of CRE leaders say they would
on track to reduce operational energy pay a premium for leasing a green
use (smart heating, smart lightning, building
smart building technology, utilization Source: JLL Future of Work Survey, 2022
tracking)
Source: JLL Decarbonizing the Built Environment, 2021

Partner with landlords Embed circularity

84% already include lowering energy Nearly 40% plan to accelerate
Maintaining momentum use / availability of renewables and investment in embedding circular
on actions will be offsets in their leases or plan to include design principles into fit-outs and
upon renewal refurbishments
critical to support net 80% already include electrification Source: JLL Future of Work Survey, 2022
zero ambitions and strategy in their leases or plan to
future-proof businesses include upon renewal
Source: JLL Responsible Real Estate: Social Value, 2023

Accelerate initiatives to improve energy efficiency and reduce emissions whilst

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moving decisively toward climate change adaptation
Responsible 79% of CEOs are adjusting, or are planning to
adjust global operations or supply chains
60% of global emissions are generated by
supply chains
procurement Source: EY CEO Survey, 2022 Source: UNGC – Accenture CEO Study, 2021

Sustainable sourcing requires action at three levels –

Sourcing products and environmental, social, and governance
services ethically Environmental Procurement
Delivers environmentally sustainable supply
chain practices that reduce greenhouse
gases and pollution, and increases recycling,
waste reduction, efficiency and climate
resilience.

Social Procurement
Strategies that increase procurement from
minority owned, women owned, disability and
social enterprise, and local businesses.
Bring positive and
sustainable change by Procurement Governance
Ensures vendors and procurement practices
taking ethical and
adhere to modern slavery, labor rights and
sustainable considerations equal opportunity employment.
when sourcing services, Source: JLL Responsible Sourcing Framework, 2022

supplies, and/or works

Partner with procurement in your organization and adopt responsible practices to
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minimize risk and ensure business objectives flow down to the supply chain
Redefined
“
City
Governments/

partnerships It takes an ecosystem of partnerships to finance and

Academia/Non-
Profit

enable the transition to a low-carbon, sustainable,

Expanding equitable world with government, lenders, insurers,
investors, occupiers, non-profits and innovators all Real Estate Corporate
networks to address Owners/Investor Occupiers/
deciding to prioritize sustainability in decision-making.
emerging complexities s/Lenders End Users

Source: JLL Decarbonizing Cities and Real Estate, 2022

79% of leading CRE functions anticipate more reliance on external partners. Future
outsourcing priorities cover non-traditional services:

Organizations will form 4-in-10 organizations are 43% predict that they will require 43% expect they will need more
looking to outsource more more outsourcing support for outsourcing support for CRE
strategic alliances and around health & wellbeing and renewable energy supply and technology solutions over the
partnerships to tackle new sustainability sourcing over the next three next three years
challenges and solve Source: JLL Future of Work Survey, 2022
years
complex problems

Harness specialist skills and expertise from an ecosystem of partnerships to achieve

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your strategic objectives and reduce spend
Innovation 50% 1 in 5 39%
of CEOs believe labor shortage will organizations globally are of CRE leaders are reallocating
clusters influence or disrupt their business having trouble finding skilled footprint to facilitate access to
strategy in the short-term tech talent talent pools
Source: ManpowerGroup, Employee Source: JLL Future of Work Survey, 2022
Source: Fortune/Deloitte CEO Survey 2022 Outlook Survey Q4 2022

Harnessing the global City Clusters: Combining innovation and talent concentration data, cities with
talent pool to accelerate similar characteristics have been grouped into six clusters:
innovation World leaders on innovation and talent. Includes:
Beijing, Paris and San Francisco
Strong performance on both metrics but with a
focus on innovation. Includes: Stockholm, Denver
and Hong Kong
Strong performance on both metrics but with a
focus on talent. Includes: Chicago, Barcelona and
Singapore
Strength in innovation but with a lower talent
concentration. Includes: Mumbai, Guangzhou and
Hyderabad
Organizations will
Strength in talent but with lower levels of world-
prioritize markets with the class innovation ecosystems. Includes: Brisbane,
strongest innovation and Hamburg and Nashville

talent characteristics Locally-focused cities with less developed or

diversified innovation and talent. Includes: Leeds,
Source: JLL Innovation Geographies , 2022
Busan and Tampa

Align your portfolio location strategy alongside your talent strategy when
reallocating footprint to facilitate access to future talent pools
 Thank you
Richa Walia Hannah Dwyer Amber Schiada
Director, Work Dynamics Head of Work Dynamics Head of Work Dynamics and
Research, EMEA Research, EMEA Industry Research, Americas
[email protected] [email protected] [email protected]

James Taylor Marie Puybaraud Flore Pradere

Head of Work Dynamics Global Head of Work Dynamics Director, Global Work Dynamics
Research, APAC Research Research
[email protected] [email protected] [email protected]
 To learn more about how we can support your workplace strategy, visit our website.

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JLL (NYSE: JLL) is a leading professional services JLL’s research team delivers intelligence, analysis JLL Work Dynamics partners with leading
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