Why Space Utilisation Matters
Real estate is typically the second-largest cost after people. Post-pandemic, average office utilisation has dropped to 40-60% of pre-2020 levels. Most organisations are paying for space nobody uses. Space utilisation data is now the most important input to real estate portfolio decisions.
Key Definitions
| Term | Definition | Example |
|---|---|---|
| Capacity | Maximum number of people a space can accommodate | Floor designed for 200 desks |
| Allocation | Number of people assigned to the space | 180 employees assigned |
| Attendance | Number of people physically present at any time | 85 people present on average |
| Utilisation rate | Attendance / Capacity (as %) | 85/200 = 42.5% |
| Occupancy rate | Attendance / Allocation (as %) | 85/180 = 47.2% |
| Peak utilisation | Maximum attendance in a period | Tuesday 10am: 140 people (70%) |
| Space per person | Usable area / Average attendance | 3,000m2 / 85 = 35.3 m2/person |
Measurement Methods
| Method | Accuracy | Cost | Best For |
|---|---|---|---|
| Manual head count | High (snapshot) | Low | Initial baseline, periodic checks |
| Badge/access data | Medium (entry only, no exit) | Low (existing system) | Daily attendance trends |
| PIR/desk sensors | High (per-desk) | Medium-High | Desk-level utilisation, hot-desking validation |
| Wi-Fi/network analytics | Medium (zone-level) | Low (existing infrastructure) | Zone-level patterns, no hardware install |
| Camera/AI counting | High | High | Meeting rooms, common areas, entrances |
| Booking system data | Low (bookings not actual use) | Low | Meeting room no-show analysis |
Utilisation Benchmarks
| Metric | Pre-2020 | Post-2020 (Hybrid) | Efficient Target |
|---|---|---|---|
| Average desk utilisation | 60-70% | 35-50% | 70-80% (with sharing) |
| Meeting room utilisation | 35-50% | 25-40% | 60-70% |
| Meeting room no-show rate | 20-30% | 30-40% | Below 15% |
| Space per person (usable) | 8-12 m2 | 15-25 m2 (due to low attendance) | 8-12 m2 |
| Sharing ratio | 1:1 (assigned desks) | 1.5:1 to 3:1 (sharing) | 2:1 for hybrid |
Using Space Data for Decisions
- Right-sizing: If utilisation is consistently below 50%, the floor/building is oversized. Consider returning space, subletting, or consolidating.
- Hot-desking ratio: If peak utilisation never exceeds 70%, a 1.5:1 sharing ratio is safe (150 people, 100 desks).
- Meeting room optimisation: High no-show rates indicate booking without using. Implement auto-release (book abandoned after 10 min).
- Lease decisions: Utilisation data at lease break or renewal determines whether to renew, reduce, or exit.
- Cost per occupied seat: Total occupancy cost / average daily attendance. The true metric, not cost per desk.
Cost Per Occupied Seat
This is the most revealing metric in workplace management:
| Scenario | Annual Rent + OpEx | Desks | Avg Attendance | Cost/Desk/Year | Cost/Occupied Seat/Year |
|---|---|---|---|---|---|
| Pre-2020 (80% util) | USD 2,000,000 | 200 | 160 | USD 10,000 | USD 12,500 |
| Post-2020 (40% util) | USD 2,000,000 | 200 | 80 | USD 10,000 | USD 25,000 |
| Right-sized (70% util) | USD 1,200,000 | 120 | 84 | USD 10,000 | USD 14,286 |
Same company, same people. Right-sizing saves USD 800,000/year and brings cost per occupied seat back to rational levels.
References
Insights & Guidance
- Post-pandemic office utilisation averages 35-50%. Most organisations pay for space nobody uses.
- Cost per occupied seat (not cost per desk) is the true metric. At 40% utilisation, cost per occupied seat doubles.
- 6 measurement methods: manual counts, badge data, desk sensors, Wi-Fi analytics, camera/AI, booking systems.
- Right-sizing from 200 desks at 40% utilisation to 120 desks at 70% can save 40% of real estate cost.
- Meeting room no-show rates of 30-40% are common. Auto-release after 10 minutes recovers wasted capacity.
Real estate is the second-largest cost after people. Space utilisation data is the single most important input to portfolio decisions. Without it, organisations keep paying for empty space because nobody has measured how the building is actually used.
- No measurement — decisions based on anecdote ("the office looks busy on Tuesdays").
- Booking data only — bookings do not equal actual use. No-show rates distort the picture.
- Privacy concerns — desk sensors and tracking raise employee concerns if not communicated transparently.
- Space utilisation study or sensor data report
- Cost per occupied seat calculation
- Sharing ratio analysis
- Meeting room utilisation and no-show data
- How full is the office at peak time (Tuesday-Thursday, 10am-2pm)?
- Are meeting rooms booked but empty?
- Are there entire zones consistently unoccupied?
- What is the average daily attendance vs desk count?
- What is the cost per occupied seat?
- Have you considered desk sharing or right-sizing?
- Utilisation study — workplace consultant.
- Sensor deployment — workplace technology provider.
- Portfolio strategy — corporate real estate advisor.