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5 Signs Your Company Needs to Cut Down Office Space: Is Your Workplace Due for a Transformation?

5 Signs Your Company Needs to Cut Down Office Space: Is Your Workplace Due for a Transformation?


Ioanna Sotiriou

Head of Marketing & Design


May 5, 2023



As the way we work continues to evolve, many companies are re-evaluating their office space needs. With more employees working remotely, some companies are finding that they have excess office space that is no longer needed. Whether you are a workspace strategist or managing your company's real estate portfolio, it's your job to determine whether your company could benefit from cutting down office space. Here are five signs to look out for that may indicate that it's time to propose reducing your company's office space:

Low Occupancy Rates

One of the most obvious signs that it's time to propose reducing office space is if occupancy rates are low. If your company is experiencing a trend of more employees working remotely, it may be time to consolidate amenities and reduce office space. By reducing the amount of office space, you can save on rent, utilities, and maintenance costs. Additionally, allowing more employees to work from home or serviced offices, can have some serious benefits for productivity!

How to spot and track: Occupancy sensors, physical observation, employee feedback.

Lack of Collaboration

Now, this one is slightly tricky: If your company is struggling with collaboration, it may be a sign that the office space is not conducive to teamwork (although, as Dropbox has proven in the past, increase of space is not necessarily a bad thing for collaboration). From what we’ve seen so far at Butlr, in a more traditional workplace setting, when employees are spread out across a large office space, it can be more difficult for them to work together on projects and initiatives. This can lead to a lack of communication, slow decision-making processes, and less efficient use of time.

On the other hand, we have also seen private offices being one of the biggest space-increasers out there. If your office space is designed in a way that discourages collaboration, such as having private offices or cubicles that isolate employees, this can also contribute to a lack of teamwork. By strategically reducing office space, you can create a more collaborative environment that encourages employees to work together and share ideas.

Signals to look out for: Low communication, silos, lack of cross-functional projects.

Underutilized Amenities

So you decided to buy the most expensive and largest printer the world has ever seen. Awesome. But now you realize that people do not really print out documents any more. What if you could free this one storage room? Sure, the change is not significant until you think of all of your amenities, tools and stuff that occupy space and are rarely being used. The lounge room, the projections room, the yoga room. Especially when you are running on a tight budget, think of your space in terms of utilization and ranking. And now channel your inner Marie Condo: does my team really use all of this?

Budget Constraints

On average, the office space is the second largest investment a company makes throughout its lifetime. If your company is facing budget constraints, it may be time to propose reducing office space. By reducing the amount of office space, you can save on rent and other related costs, freeing up budget for other important areas of the business.

This sounds super easy. Is it though?

Determining when to cut down office space can be a challenging decision for any organization. Firstly, it can be difficult to predict future business needs and growth patterns accurately. Companies may hesitate to give up office space, fearing that they may need it in the future as they expand. Secondly, there is the potential impact on employee morale and productivity to consider. Employees may become less engaged or may feel cramped in a smaller workspace, which could negatively impact their work performance. Lastly, there may be financial concerns, such as the cost of moving or the potential for breaking a lease, that can make the decision to cut down on office space more difficult.

This is why it is extremely important to root any such decision and strategy on actual data. This will enable you to communicate efficiently the reasons behind your proposals as well as the next steps of your strategy to all internal stakeholders and decision makers. Ensuring everyone is aligned will set you and your project up for success!


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