ACROSS the US, 500 million square feet of office space stand empty, much of it in skyscrapers built during the 1980s building boom. Some experts are now predicting that this oversupply might never be absorbed, as a rapidly expanding workforce of "telecommuters" use computers and communications technologies to work from home or out on the road.
In the 1980s, US politicians and developers viewed a new skyscraper as a "massive oil derrick turned upside down, drilling the sky for fees, commissions and taxes," one analyst writes in his new book published next month. Ross Miller takes an extreme view of telecommuting's likely effects on the office market in Here's the Deal: the Buying and Selling of the Great American City (Alfred A. Knopf).
He predicts cities like Chicago, birthplace of the steel-frame skyscraper, will become "an urban museum, visited only tentatively for its cultural institutions and inimitable historical flavour. The city as it has been celebrated for most of human history is in danger of extinction," he says.
A pessimistic prediction perhaps, but is telecommuting likely to take off on this side of the Atlantic - and begin to affect the commercial property market in Ireland?
What is it?
Simply put, telecommuting (or teleworking) is the most widely recognised trip-saving application of the networking revolution. It means moving work to workers, instead of the other way round.
During the past two years, as a new generation of PCs have become more lightweight, portable and powerful, they have been marketed as literally an "office in a box". They are also more likely to come with a modem - a device which allows them to talk to other computers via ordinary telephone lines. Alongside mobile telephones, fax machines and advanced communications links, such as ISDN, these technologies are removing the physical barriers that once required many employees to be in their traditional, primary" workplace.
On top of this, software and computers' "graphical interfaces", with their icons and mouse-clicking, are gradually becoming relatively easy to learn. Meanwhile, Internet service providers in Ireland, such as Ireland On-Line and Indigo, are reporting rapid increases in ordinary consumers going online. In the main, they are flocking to the user-friendly World Wide Web (or the Web for short). Suddenly, computing in general, and networking in particular, are not so specialised or complicated any more.
Teleworking, like the Internet and the Web before it, has already taken off in a big way in the US, where there were 8.1 million telecommuters last year. Admittedly, these figures (from FIND/SVP's American Information User Survey) are boosted by a wide interpretation; telecommuters are defined as employees or contractors who work at home at least one day a month during normal business hours. Even so, firms in the US seem to have adopted the idea much more readily than ones in Europe.
"Formal teleworking schemes in the United States outnumber those in Europe by five to one, reflecting the more innovative business culture there," says Peter Johnston, an official in the European Commission's telecommunications directorate. "We have perhaps a stronger cultural fondness for hierarchy.
Impact in Ireland
Even so, at the forefront of many office tenants' minds is the idea that telecommuting would allow them to cut space needs or postpone expansion indefinitely. Cyberspace, after all, is a lot cheaper than real office space (average rentals in Dublin are currently about £16 per square foot).
Tony O'Loughlin of Jones Lang Wootton says telecommuting has. not begun to make a noticeable impact on the demand for office space in Ireland. "But it's definitely a growing trend throughout the world," he says. "It's very early days, and in one sense you can argue that technology is bringing about opportunities so that we are now facing changes in work patterns that people couldn't think about a few years back."
Roland O'Connell of Hamilton Osborne King agrees the impact on the Dublin office market has not been noticeable, but he points to IBM and other large organisations which are reducing their space requirements by telecommuting and "hotdesking". From 1992 to 1994 IBM relinquished around 20 million square feet of office space worldwide.
As a management strategy telecommuting often coincides with "hotdesking", "hoteling" and "non-territorial offices", which refer to ways of squeezing more employees into less space by making the concept "this is my desk" a thing of the past. But "telecommuting", "virtual office" and "mobile office" also describe an employee's ability to work anywhere, blurring the boundaries between being in the main workplace, at home or on the road.
"Telecommuting means you can work from almost anywhere" says Andrew McLaren, senior lecturer in the Department of Geography at TCD. "Take Wilsons in Fenian Street [in Dublin], where they write abstracts for American publications. Why were they chosen for the job? Because they can offer a relatively cheap rent and a highly educated labour force, employed more cheaply than in the US.
"These people could be in the Aran Islands - it doesn't matter. But for decision-makers and headquarters functions, we're very paleolithic. We want face-to-face contacts rather than video-conference links and telephone conferences."
One reason why telecommuting hasn't taken off in Ireland, Mr McLaren says, is that commuting distances and times are not increasing as much as in areas such as south-east England, where many commuters find it commonplace to make a 120-mile journey twice a day. "The pressures for telecommuting are not as great here as in the US or UK," he says. "But maybe on the other hand there will be pressure from employers to save on accommodation."
Dr McLaren also points to some of the negative social aspects of telecommuting. "Work becomes very instrumental when you are working from home, and people do miss the social aspects and the general crack. In the Irish situation, it's even more so. For employers, too, telecommuting can also mean the lack of a supervisory eye.
Getting cabled
In the previous computing era of the 1980s, offices were the focus of change, with new computing workstations and the problems of coping with a growing jungle of cables. As businesses move towards using networks to communicate and move information, estate agents in Dublin say they have noticed that clients buying or renting office space are "increasingly aware" of the infrastructure this will require.
"Raised-access floors came into Dublin around late 1987-88, and it's unlikely that anyone nowadays would contemplate offices without them," Tony O'Loughlin says. "But the debate continues on that one, because there is the suggestions that fibre-optic cable and so on will replace wire cables, though at the end of the day, it's still an unproven technology."
Roland O'Connell of HOK agrees raised-access floors could ultimately be phased out, but it will probably be "a bit longer than people think. Even when they were introduced in the late `80s, people said it was a passing phenomenon. Wiring is getting so much smaller and people are using radio waves for communications, but it's taking longer for it to actually materialise. People are far more networked now than they were when raised-access floors were introduced. But having said that, a lot of people who do have raised-access floors, still don't use them."
Online shopping
Meanwhile, telecommuting is just part of the growing trend to move traditional economic activities into "cyberspace"; the banks, retailing, publishing and entertainment industries are all making tentative steps into this growing electronic sphere.
Telecommuting belies the unspoken assumption that retailers and property owners share a common destiny based on location; it makes "home shopping" not only possible but preferable to a growing number of consumers, and depreciates the value of location.
As more ordinary consumers go online, the greater the incentive for retailers and service providers to attract them to cyberspace rather than shopping centres.
Hence, many economists see cyberspace as not only a significant competitor for office space tenants - it will also compete for retail and service tenants.
This long-term shift from an industrial economy to an information-based one could have huge knock-on effects for the commercial property sector. While these information technologies provide many benefits to society, for the property market they seem to be more like a "negative miracle"..
New homes pages
Ironically, though, Irish estate agents have been among the first to do the digital equivalent of moving house, putting their own "home pages" on the World Wide Web. These range from as far afield as James Cleary & Sons in Roscommon to McCreery Auctioneers (Kilkenny), Royal Auctioneers (Co Meath) and Woodwards (Cork).
Other property-related Web pages include the civil engineers McCullough, Lee & Partners, the Irish Property Network (at the Web address http://www.iol.ie/- property and leading building societies such as the First National and the ICS.
Further afield, the pages of Net Estate (http://netestate.dsres.com) give information on London properties to rent and buy Windermere Real estate (http:// windermere.com) has properties in Washington, Oregon, Idaho and British Columbia and the World Real Estate Listing Service (http://interchange.idc.uvic.ca/wrels/index.html) is a currently free service for buying and selling property in North America and Europe.
With all this involvement in e-mail and building Web sites, even estate agents are beginning to telecommute. Tony O'Loughlin says it has been "known to happen" at Jones Lang Wootton, though he qualifies it - "the nature of our business is such that we have to be accessible to our clients. It's handy if you want to get away from interruptions, but it's not a regular thing."
Roland O'Connell says some staff at HOK also telecommute. "The commercial end of the office is all networked, and some of us have faxes at home and communicate from home by computer - it's handy sometimes, for example if people were too ill and couldn't get into the office but they were well enough to look at a few things online. At the end of the day, though, humans are social animals, and they enjoy interaction with their colleagues.
"Secondly, in" our particular business, we tend to discuss things a lot with each other and need face to face meetings in the office. On the other hand, branch offices can communicate much more efficiently with our head office. In some sides of the business, such as the new homes market, we're now able to link up the computer in a showhouse to one in the office, so that the staff there can carry on doing their work."
Information technologies will not empty offices overnight, but the cumulative impact on the commercial property market once 10 to 15 per cent of office staff telecommute could be enormous.
But William Mitchell, Dean of Architecture at the Massachusetts Institute of Technology in Boston, argues that the question is not an either-or one, of cyberspace totally replacing the real physical space of our cities.
Speaking, naturally enough, via e-mail, he puts it thus: "You can think of cities as giant devices for sustaining human contact and communication. They do this by providing and connecting places for people to come together for various purposes.
"As advanced digital telecommunication comes along, we have some new ways to do this. It doesn't mean that cyberspace replaces physical space totally - any more than photography exterminated painting. It means, rather, that the role of the older means is displaced, and some of the functions are taken up by the newer."
