You don’t want to pay for office space your business doesn’t need. Every unused workspace and empty conference room is operational bloat, and a clear indicator that your employees could remain productive with less space.
How do you avoid that? Most organizations turn to average utilization.
They analyze badge scan and desk booking data to determine roughly how much extra space they have on a typical workday. And they realize average utilization is well below current capacity.
So they relocate. They downsize. They sublet. They repurpose the underutilized space. On paper, this rightsizes their portfolio and frees up capital for other investments.
But there’s a problem. That average utilization only told part of the story. And the new “rightsized” workplace has either created significant operational stress or still has plenty of unused spaces. In both cases, you’re not sure why.
Average utilization is an important workplace optimization metric. But it’s not the only space utilization insight to consider when making high stakes real estate decisions. And relying on it too heavily can lead you to cut too much or too little space from your portfolio.
In this article, we’ll look at the value of average space utilization, why it causes problems, and how to avoid making decisions based on assumptions about utilization.
The value of average space utilization
Average space utilization gives you a high-level view of how efficiently a location is being used. You likely have a target for your portfolio’s average utilization level, and tracking average utilization for each location helps you zero-in on the buildings that are least aligned with your strategy.
It’s a dashboard indicator, not a fault code. You may not know the severity of the problem or exactly what the underlying issue is when you see it, but if average utilization is too low or too high, it’s a clear signal that you need to take a closer look at how a given space is being used—and that something probably needs to change.
It’s not inherently wrong to use average utilization as a guideline. In fact, it’s fairly common, particularly for organizations transitioning to a more data-driven approach to portfolio optimization. But it doesn’t tell the whole story. It’s a strong starting point, but if that’s as far as your analysis goes, you risk making decisions that will inhibit operations or leave lingering inefficiencies.
The average utilization risk
Utilization data should dismantle assumptions about how your space is being used. But if you only use one metric, you’re leaving a lot of those assumptions unaddressed. In the modern workplace, daily demand for space fluctuates with the rhythm of your operations, your hybrid work schedule, and attendance.
Average utilization flattens these patterns and removes nuance, leaving you with what may be an overly simplistic understanding of the resources your business needs to be effective. Here’s what you might be missing, and how that can affect outcomes of decisions based on average utilization.
Utilization peaks may be much higher than average utilization
Unlike average utilization, average peak utilization reveals the upper limits of the strain your operations put on your workplace resources. This metric is your daily peak utilization throughout a period, divided by the number of peaks you measured—your mean utilization peak for a period.
It’s immediately evident why this metric matters. Depending on how much volatility there is in your demand for space throughout the week, month, or quarter, you may sometimes need significantly more space than average utilization would make it seem.
Suppose, for example, that a location’s average utilization sits at 60 percent. But while your hybrid work schedule keeps attendance relatively even throughout the week, teams regularly plan meetings on Fridays, causing your meeting room utilization to exceed 90 percent on these days.
Your average utilization may lead you to assume that you have 40 percent more space than you need. It might feel conservative to only reduce your square footage by 30 percent, leaving 10 percent for variances in utilization and even some growth. But the reality is that depending on where that 30 percent reduction comes from, your operations may need to change dramatically to fit the limitations of your new space. A 30 percent reduction across the board could mean that workers don’t have access to space or resources they need during peak days or hours.
This doesn’t mean you should base your decisions entirely on average peak utilization—but if there’s a significant gap between your average utilization and average peaks, you’ll need to diagnose why that’s happening and explore scenarios (policy changes, scheduling changes, etc.) before cutting space you may need.
Average troughs in utilization may be much lower
Analyzing your average troughs or valleys in utilization helps address the inverse problem: what if average utilization is underrepresenting how much space you need on a daily basis?
Perhaps your flexibility with in-office days has led a majority of employees to be in the office Tuesday through Thursday, but the office is a ghost town on Mondays and Fridays. Or maybe the weekly distribution is more even, and utilization is dramatically lower at particular hours.
So let’s say your average space utilization rate is 60 percent again, and you cut 30 percent of your space to leave some cushion. But now the problem isn’t just that sometimes you need more space—huge troughs in utilization skewed your average, so you cut too much space for your regular operations.
Depending on how you’ve reduced your space, you may need to significantly reduce flexibility and take a more hands-on approach to defining schedules and addressing these troughs in utilization. Or you may need to backtrack and acquire more space, or else find creative ways to repurpose particular types of space that are still underutilized.
You still have options, but acting on assumptions about what your business needs will inevitably create new space management challenges for you to solve.
The key to avoiding the average utilization trap
When office-based organizations want to understand how their space is being used and make data-driven decisions about their portfolios, average utilization is one of the first metrics they turn to. And it makes sense—average utilization is the low-hanging fruit. A simple answer to the question, “how much space do we need?”
But if the simple answer ignores nuance and leads you to make ill-informed decisions as a result, it’s worth taking the time to dig a bit deeper. Here’s how to avoid over-reliance on average space utilization.
Collect occupancy data at frequent intervals
Sometimes organizations rely on average utilization due to the limitations of their occupancy data. They lack the precision to see beyond a high-level snapshot of how their space is being used.
Even if you don’t have dedicated occupancy tracking technology like space utilization sensors or a network-based occupancy monitoring system, increasing the frequency of data collection will help you recognize peaks and troughs in utilization that occur throughout the day or work week. With frequent data intervals, you can establish your average peak utilization and average troughs, and see how the variance might change your decisions, or what kinds of problems you’ll need to address as you rightsize your portfolio.
Analyze all types of space employees use
Every organization has their own targets for space utilization metrics like office space density (per person and/or per seat) and mobility ratios, which help guide decisions about space allocation. But as you look to optimize your portfolio and specific locations within it, it’s important to analyze differences in utilization within different space types—including non-reservable or permanently assigned space.
You may find, for example, that certain types of workstations are almost always in use, while others sit vacant. If your average utilization data doesn’t account for this nuance, you may wind up cutting some workstations everyone prefers and leaving ones no one uses.
Use layers of occupancy analytics
Average utilization helps remove the first layer of assumptions about how your space is being used. It sets a baseline. But because it normalizes the ebb and flow of occupancy levels, it’s also not a true representation of your “typical usage.” No one metric will give you a complete picture, so you need to place average utilization within the context of average peaks, average valleys, and perhaps even dig into all-time peaks and all-time valleys to learn about special circumstances that require unusual amounts of space.
As you explore additional layers of occupancy data, you can investigate whether variances are necessary for your operations or addressable through other means, then make real estate decisions that enable you to reduce occupancy costs while minimizing disruptions to productivity or employee satisfaction.
Go beyond average utilization with Tango Workplace
Most office-based organizations are still discovering the true value of their occupancy data. In our 2025 Enterprise Occupancy Tracking Report, 92 percent of firms we surveyed said that cost savings was one of their top two real estate and facility management priorities, and most also recognized real estate planning as one of the top use cases for occupancy tracking—but not a single respondent felt their firm was “very mature” when it came to their implementation and use of occupancy tracking.
The data points to a harder truth: space is not neutral, but most organizations are treating it that way. Every underutilized floor, every misconfigured team zone, every building running a low capacity on a Tuesday is actively costly something – in real estate spend, in energy, in the culture signals it sends to people working inside it. The problem isn’t a lack of data. But that the data isn’t legible enough to act on.
At Tango, that’s exactly the problem we’ve built to solve. Tango gives that enterprises and SMBs the visibility and analytical capabilities to assess how their locations and workplace resources are being used – not how it looks on average, but how it performace across every location and floor. Because average utilization doesn’t tell you where the waste is. It doesn’t tell you which spaces are oversubscribed and which ones nobody books twice. It doesn’t tell you whether your portfolio is working for your people or against them.
When space becomes legible, it stops being only a cost to manage, and starts being a lever you can pull.
And that’s why we created Tango Workplace.
Tango Workplace is a suite of interconnected workplace management solutions—space management software, desk booking software, occupancy analytics software, and visitor management software. Together, these specialized tools give you a comprehensive understanding of your occupancy, exposing the metrics you need to form intelligent decisions along with the capabilities you need to predict outcomes.
Want to see what Tango Workplace can do for you?
Request a demo today.
