Vaccines allow KC employers to bring workers back. But the office may never be the same
At his downtown office, the sound of mic checks and drums used to signal the end of the work week for Nathaniel Newbill.
Before the pandemic, the afternoon band warm-ups at the nearby KC Live! venue became a mainstay of the downtown work experience. From his 15th floor office, Newbill also had a clear view of the shiny facade of the T-Mobile Center — though it was still called the Sprint Center back then.
Now, the most exciting thing he spots from his Liberty home is the gardening habits of his neighbors across the street.
The director of franchise operations support at H&R Block, Newbill finally sees an end to the work-from-home reality of the last year: The tax giant recently announced it would bring its corporate workforce back to headquarters in early September.
“I am honestly pumped,” he said. “It’s like the first day of school. People are going to lay out their outfits and get dolled up. It’s going to be like prom day. It’s just been so long since we’ve seen each other.”
In the early months of the pandemic, many Kansas City employers targeted summer 2020 as a potential time frame for returning employees to the office. But those plans largely fizzled as coronavirus cases spiked here and across the country.
Now that rates of infection are falling and vaccines are becoming more widely available, employers are again reassessing when — or if — they might bring workers back. H&R Block was among the first of the area’s major employers to set a date for a return to the office and to lay out its vision for a post-pandemic workplace.
Many companies that had thought about a late summer or fall return to work are now eyeing the possibility of going back sooner, particularly since President Joe Biden ordered states to make coronavirus vaccines available to all adults by May 1.
“I think there’s cautious optimism,” said Joe Reardon, president and CEO of the Greater Kansas City Chamber of Commerce.
Reardon expects many local businesses to phase in workers’ return to the office. Even as many have realized all that’s possible with remote work, he doesn’t foresee any mass abandonment of local offices.
“That workspace isn’t going away, but it’s going to change,” Reardon said. “And it’s going to be more about providing the kind of atmosphere that employees really want to come to, which means maybe more shared workspace and ways that you can work collaboratively together. Because that’s the kind of thing that’s very difficult to do online.”
When H&R Block’s 1,700 workers return to the downtown headquarters in the fall, they’ll only be required to be on site three days a week: Tuesdays, Wednesdays and Thursdays. Employees can work wherever they choose on Mondays and Fridays.
Aside from giving a specific timeline to employees, H&R Block’s announcement is sure to be a boon for downtown restaurants, shops and bars, which have sorely missed the traffic from the thousands of workers who previously commuted in for work.
“One of the best things about downtown is that vibrancy,” said Tiffany Monroe, H&R Block’s chief people officer. “It is such a great energy and I know that has been put on hold during this pandemic. We know we’re a big part of that.”
Like many white-collar employees, H&R Block’s corporate staff showed they could work from home without sacrificing productivity.
But that doesn’t mean they’ve all enjoyed it.
“Can we do it? Absolutely,” Newbill said. “Is it sustainable? I don’t think so.”
He’s missed small things like listening to sports radio or Ted Talks during his morning commute. That ritual gave him time to prepare for the work day. Now, he jumps into each day, diving right into emails.
Even with everyone separated, it feels like there are more meetings than ever, he said. And Newbill, who described himself as an “extreme extrovert,” said he misses small conversations with coworkers. Things like asking about a kid’s ball game or what’s on for dinner help him connect with his 23-member team. And the video meeting format just isn’t conducive to those kinds of interactions.
“It seems formal and weird so the discussion doesn’t seem like it should,” he said. “But we try our best to find ways to be creative and still have that relationship.”
With H&R Block’s new schedule, Newbill plans to limit meetings on Mondays and Fridays, when employees will likely do more independent work and planning.
“For those who are loving work from home, the new strategy provides the best of both worlds,” he said.
‘Corporate America is changing’
It’s still unclear how the pandemic may impact commercial real estate over the long term.
After learning that remote work can work, many companies have eyed the potential cost savings of reducing or eliminating office space altogether. But even those who do want to return to a traditional office may need to make major changes.
In recent years, many firms have sought to put larger numbers of workers into smaller office spaces. It’s unclear whether those models may work in the future if safety concerns linger.
For now, H&R Block doesn’t expect any major changes in its real estate needs, particularly since it expects the entire corporate workforce to be together three days a week.
“We filled up that building before the pandemic and we’ll fill it up again as appropriate,” Monroe said.
Employees will not be required to be vaccinated to return to the office. But the company will continue enhanced cleaning of the building and will require masks in areas where employees can’t physically separate.
For H&R Block, the pandemic has underscored the importance of physical connectedness. There is value in working side by side that can’t always be replicated online, Monroe said. But many employees have also grown used to the flexibility of working from anywhere.
That’s why the company came up with the hybrid model: employees who crave the office environment can return, working five days a week downtown if they choose. Three days a week, most workers will be around, which will allow for planning, brainstorming and social interactions.
But those that like working at home will still have that option two days a week. While virus cases or variants may change specifics, Monroe said the company intends to use this model for the foreseeable future.
“The work style of corporate America is changing,” she said. ““This will be our go forward post-pandemic plan.”
So far, other big employers like Hallmark Cards and the Federal Reserve Bank of Kansas City are relying on mostly remote workforces with only a few employees on site.
Most T-Mobile employees continue to work remotely, but the company is allowing about a quarter of employees to work at their Overland Park offices. A T-Mobile spokesperson said those who are working from home won’t be asked to return to the office until June 1.
Architecture and engineering firm Burns & McDonnell has about half of its staff back at its Ward Parkway campus. Spokeswoman Kristi Widmar said the company was still exploring how it might bring back more workers after more vaccines are administered.
Officials with Cerner Corp., the region’s largest private employer, will reassess their plans in April. A spokesperson said the company may begin to bring workers back this summer.
Only a couple of months after moving most employees to remote work, it became clear that some positions may never return to an office. Likewise, Cerner expects corporate travel to be permanently reduced because of the pandemic.
“I don’t think we’ll ever go back to before,” Eva Karp, a senior vice president and chief clinical and patient safety officer at Cerner, told The Star last May.
How office real estate is changing
While H&R Block is among the first to target September as a potential return to work date, it probably won’t be alone.
In its U.S. Office Sector Outlook report in January, national commercial real estate firm Cushman & Wakefield said most firms have identified Sept. 1 as the date they plan to return workers in full force. So far, the company hasn’t seen any big migration away from city centers.
“Don’t rush big real estate decisions,” the report said. “There is often value in not being the first mover.”
Many employers are still in a wait-and-see mode, the report said, with an all-time high of short-term lease renewals. The company expects the share of people permanently working remote to double over the next decade.
Many Kansas City businesses are eyeing June and July as possibilities for bringing workers back, said Ryan Biery, senior vice president of brokerage at Copaken Brooks.
“As people get more confident with the vaccine roll out, they might accelerate that,” he said. “I don’t think anyone’s in a huge hurry to get back but there are people that obviously want that social interaction and that typical office environment.”
Biery manages some 2 million square feet of commercial real estate, including 1201 Walnut and Town Pavilion in downtown Kansas City. Those multi-tenant buildings are only seeing about 20% of the workers who came in each weekday before the pandemic.
He said landlords are more willing to cut rents now. And companies are more interested in short-term leases rather than long-term agreements. But so far, he said most companies have held onto their office space — even if their workers aren’t using it.
“Long term we still feel very bullish about our office buildings and the need for physical office space,” he said.
The needs vary by industry: one law firm for instance, was recently looking for a typical office space with private offices for attorneys. But a professional services firm that employs workers who travel was recently shopping for a flexible space that would allow employees to come and go without having their own dedicated space.
Though few tenants want more total square footage right now, Biery said they are looking to spread employees out more.
“Companies are looking for a little bit more flexibility as they’re thinking about the office space,” he said. “The ability to expand or contract has become more important than a year ago.”
This story was originally published March 15, 2021 at 5:00 AM.
