Tech Real Estate Grab Headed to a Small Town Near You

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We’re at an inflection point that affects almost all of us. Should we return to the office en mass? Continue working at home? Further develop a hybrid approach to working from anywhere?

In a recent article, even Salesforce had changed its position on working away from the office and is now leaning towards calling people back. In fact, Salesforce has efforts underway to build towers from Chicago to Sydney. That’s quite a departure for the company that dropped everything to build work from anywhere software just a couple of years ago.

But don’t cry for Salesforce. The Work from Anywhere effort only served to burnish its reputation for having a development platform that enabled the company, its partners, and customers to pivot to whole new processes.

There’s no doubt that we’ve crossed a Rubicon of sorts; and work will never be the same as it was during — get ready for this — the good old days of Covid.

Some people will continue to work remotely and, if there’s a lesson from this time, it may be that more people will join the ranks of the self-employed. Why not? The issues associated with commuting long distances to central cities for white collar work are still with us and will continue roaring back as more of us jam the highways.

Small Town Appeal

The ongoing tech real estate boom shows vendors planting their flags in smaller cities where home prices are more affordable, and commuting is less a gladiatorial sport.

Other studies suggest that much of the higher salaries people command in big cities gets eaten up in housing costs, so moving to smaller cities might be part of a cost savings effort. That’s all to the good. But the return to office movement still lacks a rationale beyond bosses saying there’s something ‘special’ about converging in the office to do thinking work. I am not so sure.

I do think that if you work in a startup, where you are defining a new product or category, the prospect of sharing ideas through formal meetings and hallway serendipity can be invaluable. But does this refer to everybody in the organization or an elite bunch?

Distributed Workforce Advantages

This certainly describes a big swath of the tech sector but even there, the bigger a company gets, the less probability of a hallway conversation that changes company direction. I once knew everyone at Salesforce by name, but that was quite a while ago. You get the picture.

There are some definite advantages to distributing offices across the countryside beyond the commute.

By locating an office in a place that is not on the West Coast, a company can take advantage of large populations of qualified candidates who might not want to move. Also, a smaller footprint in multiple cities might be more eco-friendly. Just consider the demand for fresh water from a large population concentrated in a few square miles.

Additionally, consider the continued drying out of different parts of the continent, especially the West, and you can see many reasons for partially distributing office populations. Of course, severe storms elsewhere can basically amount to picking your poison. Then again, when a storm makes commuting impossible at least there’s all that work from home infrastructure to rely on.

So the jury is still out on the question of returning to the office.

Remote? Company? Salary?

One article I read admitted as much and said that big tech companies have so much cash right now that they can afford to throw up billion-dollar towers with lots of amenities to attract employees back to the office.

Admittedly that’s a bet that the economy will move in one direction, but the companies are sanguine about guessing wrong. Better to have the space and decide you don’t need it than to need it, not have it, and miss out on expansion.

Lastly, the specialness of having everyone working under one roof is going up against a newly empowered workforce. Recruiters who go after in-demand tech talent report they’re lucky when they get a response from targeted people. Some simply respond with a few words like Remote? Company? Salary? That’s ultimately a significant tell.

The talent is in the driver’s seat right now and that’s special, indeed.

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