Savills: Talent Impacting Corporate Real Estate Strategies of Architecture and Engineering Firms

Architectural and engineering (A&E) firms are having to recalibrate their real estate strategies to balance attracting the best talent against the cost of the best office space, according to new research from Savills.

According to the survey of experts around the world who work with A&E firms, 78% of respondents say that access to talent is the most important factor shaping portfolio decisions, followed by real estate costs at 74%. This may lead to firms reassessing their location strategies to secure access to high-quality expertise in the face of talent shortages, while also seeking the best office spaces to showcase their technical capabilities and design philosophies at a lower cost.

A combination of talent constraints, cost pressures, client expectations and tech are influencing where firms locate and how they configure their portfolios.

Currently, San Francisco and New York remain the dominant A&E talent hubs in North America, with Zurich and London leading in Europe and Singapore top in Asia, says Savills. However, the international real estate advisor says some alternatives such as Dallas and Seattle in North America, Oslo and Helsinki in Europe and Melbourne in Asia Pacific are increasingly offering high-quality talent at lower office occupational costs and may see increased demand from the sector.

Source: Savills Research. NB. 1 = the top ranked city for global A&E talent in Savills top 40 index. Prime office rents reflect best-in-class office space, based on the top buildings in each market.

Savills also examined the portfolio strategies of A&E firms in H2 2025: 64% of respondents said firms were maintaining or growing office space footprints (25% expanding, 39% maintaining) while 35% were planning on consolidating. There are regional differences: around 36% of firms in the US increased their office footprint, compared with 33% in EMEA and 15% in Asia Pacific.

Sarah Brooks, Associate Director in Savills World Research team, comments: "For architecture and engineering firms, finding skilled talent is critical - but the cost of employing that talent and then accommodating it in suitable office space can vary widely globally. While the established A&E hubs are likely to always retain their attractiveness as places for firms, given their access to world-class universities and innovation, and accessibility to clients, our research identifies where perhaps more cost-conscious practices can access strong talent pools without the premium of the big global cities."

Rick Schuham, CEO of Global Occupier Services at Savills, adds: "A combination of talent constraints, cost pressures, client expectations and tech are influencing where firms locate and how they configure their portfolios. Increasingly A&E firms are looking for their offices to demonstrate environmental leadership - and to provide tangible examples of flexible future-focused workplace practices to clients.

"Showcasing how technology can be integrated to help enable evolving work practices is also key. The competition, and therefore the occupier costs, for space that meets these requirements in the top global cities is fierce. Looking ahead, these location and cost pressures are set to intensify, giving informed corporate real estate planning an increasingly important role in supporting business performance."