Commercial real estate has a ‘shock coming’ as return-to-office plans fall short, CEO says

There’s a “shock” coming for the commercial real estate industry, but the opportunities ahead are huge, according to Mark Dixon, CEO of flexible office company IWG.

Technology enabled a “fundamental seismic shift” in commercial real estate as the Covid-19 pandemic forced millions of people to work from home for the first time, Dixon said — and workers don’t necessarily want things to go back to how they were before.

“There’s this assumption that people like commuting into a central business district. They don’t. It’s a complete waste of time and money and they don’t want to do it,” Dixon told CNBC on “Squawk Box Europe” Tuesday.

He added that employees are now working more productively “than they’ve ever done before.”

Dixon founded IWG — formerly known as Regus — in 1989. Now, it has over 3,300 offices across 120 countries.

He says “there’s a shock coming” for commercial real estate looking ahead. “Look at the United States. You’ve got some of the largest property companies in the world handing back properties to their bank.“

But it’s not all bad news; Dixon said there is a “real opportunity” for the use of real estate to change. In fact, he said that offices in the future could actually work in a similar way to gas stations.

“They’re everywhere, it’s a network of petrol stations, [you can] drive anywhere in the country. Work will be like that. You will find places to work everywhere, we network them all together and make them easy to use,” he said.

“We’ve got such a huge amount of opportunity in the business we’re in.”