One of the world’s biggest architecture firms says it feels a sense of “optimism and engagement” ahead of 2025, boosted by easing inflation, looming rate cuts and a growing desire among developers to start investing again.
On Thursday, US-based Gensler unveiled its “Design Forecast,” which outlines the trends expected to shape design in the coming year. These trends include a focus on how design needs to adapt to changes in city life – the continued shift to working from home, the resulting impact on city centers and commercial districts, and increasingly unaffordable housing.
“Our cities are convenors,” said Jordan Goldstein, co-CEO of Gensler, in an interview with Wealth in mid-November. “That’s where we see the power of design to really shape that experience for the better.”
The COVID pandemic caused a change in urban life that can still be seen. Despite the company’s appeals that go back to the office five days a week, hybrid work It appears to have settled into urban professional life, reducing the need for office space and, in turn, reducing foot traffic through city centers. This, along with higher interest rates, contributed to a major global decline in commercial real estate marketbecause office and retail tenants are reducing their physical presence.
“The issues we’ve seen post-pandemic are driving a lot of (these design trends),” Goldstein said. Then add what he calls “crisis multipliers”—such as technological change and sustainability, to name a few.
But he notes that planners are now far more willing to consider experimental conversions in the urban core. “There’s an opportunity for those dialogues (with planners) that frankly weren’t necessarily happening regularly, before the pandemic,” he said. And in some markets, like India, those discussions “weren’t happening, period.”
In one example, Gensler is working with the City of Philadelphia on a turnaround South Broad Street into a 10-block long art park, with greenery, outdoor entertainment spaces and public artwork. The company is implementing a similar project in Chicago Michigan Avenuebuilding new green spaces, performance spaces and a new cafe in Jane Byrne Park’s water tower.
“Most of our cities know that in the future they can’t just thrive by doing things the way they’ve been doing them. Bringing design into the mix really pushes forward innovation (and) experimentation,” Gensler co-CEO Elizabeth Brink said in mid-November.
Unique and unpredictable
In its “Design Forecast,” Gensler identifies five trends it calls “the most important and actionable insights our clients need to know,” culled from its dozens of offices around the world.
“We come to all our locations and ask: What do you see? What do you see as a need at your location?” Brink said in mid-November.
Several trends relate to the need to rethink the city after COVID, as neighborhoods move away from the more traditional mix of segregated office districts, suburbs, and shopping and entertainment districts that characterize most modern cities.
For example, Gensler predicts that mixed-use districts will take “center stage in 2025, as cities look to “encourage community engagement and bring people together around visceral shared experiences.”
Both Brink and Goldstein referred to the idea of a “20-minute city,” or an urban environment where people can access home, work, and entertainment in just a 20-minute commute.
But beyond that, Brink suggested there is a desire to create a “more immersive and participatory experience,” citing sports as an example. “People want to go and have experiences that are unique and unpredictable. They do it together and it’s something that creates a sense of community,” she explained.
How to fix an office
Another major design trend that Gensler points out is the need to remodel the workplace. Instead of ordering people back to the office, employers will need to make it a valuable place to do work. The offices will be focused on “employee experience” and “inspiration,” the company predicts, as tenants continue the “flight to quality” that fulfills the “professional aspirations” of their employees.
“We know the workplace is still very important,” Brink said in mid-November. “It’s really important for organizations. It is very important for creativity. It’s very important for connection, it’s very important for the human experience,” she explained.
Gensler’s Global Workplace Survey, released in May, reports that nearly all high-performing office workers have access to space for focused concentration, compared to just 26% in low-performing workplaces.
Some companies have successfully revived in-person presence after moving to a nicer office. British bank HSBC doubled the rate in which New York-based employees entered the office after moving to Spiral, designed by Danish architect Bjarke Ingels.
However, the decline in commercial real estate caused by the hybrid business is not going away. Gensler predicts that the low prices offer developers the opportunity to create “new valuable real estate.” Lower interest rates could also encourage developers to take the plunge and turn their unused office space into something more sought-after. The architecture firm says the “adaptive reuse boom” will go beyond just a straightforward office-to-apartment transition, as developers will instead embrace “creative conversions,” including sectors such as healthcare, science labs and senior living, among other sectors.
But Brink noted that the transition from office to home is easier said than done. The offices do not allow themselves the traditional arrangement of apartments, due to the need to add plumbing infrastructure and kitchen areas.
He suggests that the shared living model, with smaller units and shared bathrooms and kitchens, will be an easier convection for developers. Construction costs could be reduced by a third, and conversion would provide three times as many units.
“It’s a creative way of looking at some of those conversations that might be great for different urban populations: students, retirees, good for anyone who might just need a place,” she suggested.
Converting underutilized office buildings into apartment complexes could help fuel another of Gensler’s 2025 design trends: the push for “market-rate housing,” as changes in zoning laws and building codes encourage the creation of all kinds of homes.
One plus one equals three’
Gensler, founded in 1965 by architect Art Gensler, has more than 6,000 designers spread across 17 countries in America, Europe, Asia and the Middle East. Among Gensler’s many projects are Headquartered in Santa Clara, California of Nvidiathe terminal one which is still under construction at John F. Kennedy International Airport in New York, and shanghai towerthe third tallest building in the world. The company reported $1.84 billion in revenue for its 2023 fiscal year.
Brink and Goldstein took over as Gensler’s co-CEOs in April. Their predecessors, Diane Hoskins and Andy Cohen, ran the architecture firm together for nearly 20 years.
Courtesy of Gensler
Gensler is an unusual example of a company that has embraced the co-CEO model. Other companies have tried having two CEOs with mixed success: Salesforce and SAP both saw one of their two co-CEOs step down within a year. (On Monday, the chip maker Intel adopted a co-CEO model, elevating David Zinsner and Michelle Johnston Holthaus to serve as temporary co-executive directorsreplacing CEO Pat Gelsinger who is retiring.)
Still, successful co-CEOs say the structure allows executives to lean on each other for support, keeps a particular leader’s biases in check, or simply enables the C-suite to get more done each day. “Most CEOs have 24 hours in a day, we have 48 hours in a day,” Hoskins said on Wealth‘with Leadership Next podcast last year.
“The two of us can work together and be a ‘one plus one equals three’ scenario,” Goldstein said. “We each have some particular passions, and we brought them together, and it really resonates throughout the company.”
