IPD Press Release
24th November 2008
IPD Space Code could save property occupiers a fortune
London, 24th November 2008: The IPD Space Code, a new global standard for
measuring the space performance of corporate property, is launched today which
provides public and private sector employers with the potential to identify dramatic
cost-savings through space rationalisation.
With many organisations spending between 5% and 15% of their total operating
expenses on the workplace, occupiers will increasingly look to their ‘space budgets’
to trim costs, particularly in the worsening economic climate. The new IPD Space
Code – in association with Johnson Controls and EDF Energy – will help property
occupiers examine their existing space commitments in any type of building,
anywhere in the world.
By offering a transparent basis for measurement, comparison and benchmarking of
space performance, inefficiencies can be identified and subsequently eliminated.
IPD’s own data indicates that more than three quarters of the potential cost savings
in a typical UK office estate come from space rationalisation.
But space reduction does not necessarily mean a worse working environment: plenty
of best-practice case studies show that radical restructuring of the workplace can
result in a more than 25% reduction in property costs per person as well as large
reductions in carbon produced, while significantly improving staff satisfaction. IPD’s
latest annual survey of large space users has identified that more effective use of
space is the primary means of contributing to better organisational efficiency and
effectiveness for many large office users.
To show the potential impact the Space Code could have, IPD has calculated cost
savings of more than £5 billion in the UK economy alone1. In the UK, the average
space per person level, at 13.4 m2, is low by international standards, so the potential
Including vacant space, IPD’s data shows the average UK office sector employee uses 13.4 m of
space. Organisations could reduce the total allocation to an average of 12m or even 10m per person
by introducing flexible working hours or mobile working. Extrapolated across the entire UK private sector
office market, the total savings would be in the order of at least £3.5 billion per annum. Further savings
of at least £2 billion can be added to this figure for many different types of building in the public sector.
in many other parts of the world is even greater. The Government is now aiming to
operate offices on its central Government civil estate off floorspace standards per
person of 12 m2 for existing buildings and 10 m2 for new and refurbished buildings.
Obviously these potential cost savings will not be achieved over night, indeed they
can only be realised when freehold buildings are sold and leases are terminated or
broken. Nevertheless, the Space Code does offer property occupiers a
comprehensive tool which will enable them to realise cost savings on a significant
scale previously unconsidered. It will also support analysis of the utilisation of space
to identify where radical space sharing ideas can be implemented – this will be
particularly important in the public sector.
Together with the well-established IPD Cost Code, the Space Code can help
occupiers focus on reducing their cost exposure per employee. IPD and its
associates aim to establish the Space Code as a global industry data standard with a
unifying set of definitions for space measurement to support the communication of
data and information; improve future workplace design and; help foster better
decisions within an area where more economically and environmentally efficient
solutions are required.
Hermen Jan van Ree, Head of Research & Development at IPD Occupiers, the
author of the Space Code, said: “Real estate and facilities management executives
often struggle to make meaningful comparisons across their estates, especially if
they are international. Use of the IPD Space Code will lead to a better understanding
of how space is occupied and the potential for rationalisation across a whole estate.
It will also enable much more accurate comparisons to support strategic decision
making, as well as allowing the industry to keep abreast of space management
Van Ree added: “By providing the right amount of granularity, space measurement
data from different countries becomes easier to interpret and data comparisons are
more likely to be accurate. In addition, by linking space data to other performance
data, end-user organisations can build a balanced view of performance for each and
every building they occupy.”
Andrew Burt, International Director, Real Estate EMEA, Johnson Controls,
Global WorkPlace Solutions, said: We work with some of the biggest companies
across the globe and we know that in today’s shifting economic climate, these
corporations are increasingly focused on driving down cost and improving efficiencies
across their property portfolios. One important barrier to this has been the inability to
measure space on a consistent basis across geographies to produce meaningful
performance metrics and benchmarks. The IPD Space Code will bring greater
transparency, enabling leading edge solutions based on comparable and reliable
data. We are proud to sponsor the code and are excited about its potential to impact
our customers' triple bottom line and increase their shareholder value.”
Andy Trotter, Head of Property at EDF Energy, said: “To ensure maximum
building efficiency against a backdrop of continuous efforts to improve our
sustainability performance and minimise property costs we are always seeking
innovative ways to improve our use of space. It is against this background that EDF
Energy is sponsoring the IPD Space Code and will use it to actively manage the use
Notes to editors:
IPD is a global information business, dedicated to the objective measurement of
commercial real estate performance. As the world’s number one provider of real
estate performance analysis for funds, investors, managers and occupiers, it offers a
full range of services including research, reporting, benchmarking, conferences and
indices. We operate in over 20 countries including most of Europe, the US, Canada,
Australia, New Zealand and Japan. The IPD Space Code joins two other occupier-
related data standards published by IPD, the IPD Total Occupancy Cost Code and
the IPD Environment Code, which both set out performance measurement
frameworks and definitions in their respective fields.
Johnson Controls (NYSE: JCI - News) is the global leader that brings ingenuity to
the places where people live, work and travel. By integrating technologies, products
and services, it creates smart environments that redefine the relationships between
people and their surroundings. Its team of 140,000 employees creates a more
comfortable, safe and sustainable world through its products and services for more
than 200 million vehicles, 12 million homes and one million commercial buildings. Its
global workplace solutions division plans, creates, manages and renews the places
wherever businesses work in the world.
EDF Energy is one of the UK’s largest energy companies and a wholly-owned
subsidiary of the EDF Group, one of Europe’s largest energy groups. It generates
around 6% of the UK’s electricity and delivers electricity to 7.9 million customer
homes and businesses through its public networks.
For further information contact:
Christopher Hedley, Director IPD, Occupiers and Management,
+44 (0)20 7336 9250; +44 (0)7885 750497, firstname.lastname@example.org
Hermen Jan van Ree, Research & Development, IPD Occupiers,
+44 (0)78 7577 6719, email@example.com
James Wallace, Global Press Officer
+44 (0)20 7336 4778, firstname.lastname@example.org