Ashleay: Welcome to iA Financial Group's “In Your Interest” podcast, where we aim to share with you the essentials of economic news and its impact on your finances. My name is Ashleay, and this week we're talking real estate again with Sébastien Mc Mahon, our Chief Strategist and Senior Economist, and Claude Sirois, Managing Director, Real Assets and Private Equity at iA Financial Group. So gentlemen, today I would love to talk about the “Office of the Future”: if we were talking about developing new offices, what do you think would be on the bucket list?
Claude: Your question about the office of the future is not an easy one. I’d make a lot of money if I had the answer, because there's a lot of people that are asking that exact question. But one thing I know is that it's going to be about experience, it's going to be about the amenities you offer, it’s going to be about the space, the environment. You know, there's different work environment styles. There's one style that's called a “homey” style, which tries to recreate home at the office, with food, furniture, etc. that gives it that look and feel and everything. There's a lot of creativity involved in trying to bring employees back, right? I think the pizza shops in Montreal are pretty busy on Wednesdays and Thursdays because there's a lot of pizza being ordered for gatherings at certain offices.
Sébastien: Yeah. And even at our offices, they invested a lot, which was awesome. Now we have a lounge, we have pool tables, we have ping pong tables, we have arcades and all that. And you still need to organize events to get some people to come. So as a manager, HR and all of that, you become an event organizer more than anything else.
Claude: Correct. You will be looking for a different profile for building managers because previously they were making sure that, you know, the lights in the parking lot were on and the floor was clean. Well, now, no, no, no: they have to organize yoga sessions at lunchtime which makes some say, “Shoot! How do I do that? Where do I start?” So it's all about creating a space and an environment that’s stimulating and engaging. We've done this in Montreal, we've initiated yoga sessions, and one of our tenants said, “You know what? When you hold yoga sessions, I have more people in the office.” Which is great, right? So that relationship with our tenants was elevated to a completely different level. And I think it's good, because, at the end of the day, the employee will benefit.
Sébastien: Yeah, I agree.
Claude: There are different things that we need to consider now, in terms of making sure that the office space is up to today's standards. Obviously, this was a topic before the pandemic; there were some trends. But you know, those trends prior to the pandemic were about trying to find ways to put more people in less space. Today it's a completely different scenario. You need to not only ensure that you have sufficient space to accommodate employees, but you also need to bring in new experiences, new areas for collaboration, new areas for technology, to make sure that the space offers all the amenities that the employees are looking for, different things related to food, to health and wellness, to all the little things that would attract employees back to the office. This can be cleaning services, changing your tires in the parking lot. You know, there are all kinds of elements that now come into play when planning the physical offices of the future, such that employees will want to come back.
Sébastien: To attract them back and stimulate creativity. Like Apple Park—the headquarters of Apple—which is built so that people bump into each other where normally they wouldn't meet, where, even if you work in different divisions, you collide with the different partners as part of the design.
Claude: That's right. There's a term that describes this, it's called the “collision rate.”
Sébastien: Yeah, right.
Claude: This collision rate is so, so critical. So critical if you want to evolve as an employee, to meet colleagues that are in different areas and get to know them. And that brings me to a bit of an editorial comment. Because you're the CEO of your own career. So, at the end of the day, if you want to ensure that you're going to be a successful business, you’ve got to get out of your basement. And for some reason, some generations have a bit of a hard time understanding this. But to me, it's part of ensuring that you will be exposed to opportunities, to colleagues, to projects, that you meet different people in order to increase your collision rate, your lines of communication, making you a better employee, a better manager. I mean, nobody can convince me that you can develop your soft skills in your basement. I'm using an extreme analogy, but, you know, you have to get out there. And when you're into the sales side of things, well, if you're not out there in the traffic, your competition is. So, you have to make sure that you take advantage of the new space and the new work environment to ensure that you grow as an employee and as a professional.
Sébastien: And it's one thing that we’ve experienced at the new head office at iA Quebec City where, you know, there’s… well what isn’t there? I can't make the list. At the tip of the iceberg there's the lounge area where you can meet people like the CEO, who’s always there, or executives. You can just go sit there, where there's some music and you can work for a few hours, if you want.
Claude: You know what I'm doing in my basement now? I'm practicing ping pong so that I can beat the CEO back at the office.
Sébastien: Good luck, I hear he’s pretty good.
Claude: I know.
Sébastien: All right, well, practicing will get you there, but I'm sure he's practicing, too, so… Back to the office: if you want some quiet time, you can go in a little like cubicle kind of environment if that's your thing. You have access to a vitamin water, free coffee…
Ashleay: Yeah, we have the cafeteria, with a cleaning service on site. We have the library. Oh, goodness, you should have seen me in there. And you know what? I was actually among those who said, “you'll never get me out of my basement. I'm too comfortable here.”
Sébastien: With your two cats, three dogs, four tarantulas and rabbits and all of that?
Ashleay: With the entire zoo! Exactly! But once you go back, once you see these beautiful new developments that we've made, and once you see your colleagues, I think it’s a big mood booster, it's something that we—you know, we kind of lived through the pandemic on adrenaline and since then it’s kind of fallen back down, but now it’s time to socialize, we need to see people again.
Claude: Absolutely. The other thing is, at the beginning of the pandemic, the lines of efficiency and productivity were pretty close together. Well today, I'm not sure they are still so close. We might be as efficient as we were when working from home. But I'm not so sure about productivity. And we see it; we feel it; we live it. When we go to the office, how many problems, how many teams have we saved by bumping into colleagues and saying, “hey, I wanted to talk to you about something.” You just saved a team, maybe a cancellation, three cancellations in a week. So that’s productivity, right? And I think people are realizing that, you know, working in an office is fun.
Sébastien: And it's especially true for newcomers. I mean, if you were just out of school in the last few years, learning the ropes by staying at home—as you said, you can be efficient there, but you don't get the culture; the culture can’t be transmitted through like one-on-ones that last 30 minutes on Teams. You need to be there, to have lunch with your colleague: you need to take in that culture. And by just providing some incentives to get everyone there, to have some fun together, laugh together, that's how you become productive on top of being efficient.
Claude: And it's all part of our brand.
Ashleay: Yeah, absolutely
Claude: It's the brand.
Ashleay: And Claude, you were closely involved in this whole development. What about the ESG factor? This is very important both for iA and for many big companies like iA. How is this working out, the ESG factor?
Claude: Well, it's non-negotiable today. In everything that you touch, you need to consider how to reach the highest ESG standards possible. So when you look at the new office as an example or, you know, anyone trying to redo their work environment. Right from the get-go, you have to consider the materials: are they the most efficient from a sustainability point of view? You have to consider the work environment, the health and wellness, the filters, the air: everything needs to be considered now, because we think a lot about the environment, the E in the ESG, the S, the community, and the engagement, being part of a group… I don't know how many bees we've got on top of our building, we collect and distribute the honey. All this needs to be considered now each and every time you want to bring the hammers out.
Ashleay: Thank you, Claude. Thank you, Sébastien. And to all listeners, thank you for being here. Once again, if you liked this episode, we invite you to share it with your friends or give your opinion on the listening platforms Apple, Spotify or Google Podcasts. And we'll see you next week. Love this podcast? Want to know more about economic news? Follow our “In Your Interests” podcast, available on all platforms. Visit the Economic News page on ia.ca or follow us on social media.