Monday.com may help other companies work remotely, but the global software firm is investing heavily in strengthening its own office portfolio.
With corporate headquarters in Tel Aviv, Isreal, the company is racing to open and expand hubs around the world to accommodate a fast-growing workforce, most recently with a relocation of its Denver office that more than doubles Monday's presence in the city.
The firm launched in 2014 and went public in 2021, aiming to increase productivity and collaboration for clients through its online project management system. While this process can make it easier for some firms operating on a remote or hybrid basis, Monday says it is working to create an office environment that's too good to stay home.
"We place the office first," Inbal Avital, Monday's vice president of global workplace operations, told CoStar News. "We're planning and investing a lot of time and resources in the office. We respect the people who also want to work from home, but the best collaboration is face-to-face. That's hard when you're always working remotely."
Monday's willingness to invest in physical office space is part of a wave of tech companies prioritizing real estate commitments, even though their products can often help their customers operate with a more remote workforce.
A growing cohort of smaller tech companies such as Monday now account for the bulk of the nation's office leasing activity. The tech industry has contributed almost 20% of total leases so far this year, according to a recent CBRE report, the largest share among any other tenant type.
'Center of everything'
In Denver, Monday has moved to a 26,000-square-foot office at 1755 Blake St., an upgrade from the 10,000 square feet it was previously leasing but has quickly outgrown since planting a flag in the Colorado area two years ago.
The move followed an expansion in London last month, when Monday took over an about 80,000-square-foot office on the top three floors of 1 Rathbone Square in Fitzrovia that was previously leased to tech giant Meta. The move roughly quadrupled the company's former hub that spanned about 12,200 square feet at nearby 20 Rathbone Place.
In Denver, where Monday's local workforce has grown by about 80% over the past two years, Avital said the new downtown office spotlights the company's broader real estate priorities when it comes to choosing and designing office space.
The address needs to be centrally located with seamless access to transportation and nearby amenities. The layout has to accommodate a myriad of working styles that make it possible for employees to collaborate and focus on their own. Most importantly, Monday gets feedback from its workers to tailor each office to what they most want, whether it's a barista bar or on-site fitness center, to ensure the space is somewhere they want to be.
"It is really important that people come to the office, so we want to create the best environment where everyone is comfortable and has everything they need," Avital said. "We have locations all over the world that are always at the center of everything, giving each employee access to transportation and restaurants and anything else they need.
"It needs to be a place where people want to come every day."
Space for growth
The tech sector's office rebound follows several years of real estate cuts from large companies such as Amazon, Meta and Alphabet's Google, all of which shed hundreds of millions of square feet of office space they no longer used, needed or wanted to pay for, pushing the country's availability rate to record highs.
The United States office vacancy rate, fueled by companies offloading record amounts of space and adjusting to pandemic-era shifts, has climbed to about 14%, according to CoStar data. Tenants collectively handed back upward of 65 million square feet last year, boosting the total to more than 180 million square feet of move-outs since the start of 2020.
However, technology companies inked just shy of 10 million square feet of deals in the third quarter, continuing the slow but steadily rising office demand throughout the industry.
Tech companies are also beginning to ramp up hiring plans after an extended period of sweeping job cuts in late 2022 and early 2023, another sign that the need for expanded physical office space could keep climbing.
Monday attributes its own expansion plans to its fast-growing workforce that has climbed beyond 2,300 people around the world from about 1,550 people at this point in 2022. Avital said the company expects to expand by another 30% over the next year, plans that will likely require additional real estate expansions.
"We have a lot of work planned over the next year and we're always looking at least two to three years ahead to make sure our offices can accommodate us," she said. "There are lots of locations under consideration if and when we need to expand, so we're exploring Sydney, São Paulo, Poland, other options in Europe ... it's a dynamic situation."
A commute-worthy office
Regardless of how much space companies in and beyond the tech industry take on, the hurdle can be convincing employees to regularly make the commute.
While some corporate heavyweights such as Amazon, Dell, Citigroup, Walmart and UPS have recently tightened in-person requirements, offices across the country are still only about half as full as they were before the pandemic, according to data from Kastle Systems.
About one-third of U.S. companies require employees to come to the office five days a week, according to recent data from work policy tracker Flex Index. Less than 10% of tech companies with more than 1,000 employees have such a requirement.
Avital, with a resume that includes work with a number of other global tech companies, said Monday's high office attendance rates are a product of people coming in on their own volition — not through an enforced mandate.
The local artwork, meditation rooms, spas and other amenities it provides at its offices help, but its success in getting people to commute more frequently comes down to making the office a place people want to be.
"I've worked with other high-tech companies where attendance has been far lower," Avital said. "Monday has been able to create an in-office experience that is different, not just with the amenities, but the entire experience. That experience isn't good when you're forcing people to come in."