Because it's cheap. Less walls to build, more employees packed on to a floor.
Do you lose more money than you're saving due to decreased productivity? Maybe. But that's hard to prove, and "This office proposal is $X million cheaper because we can lease three fewer floors" is very straightforward.
Do you lose more money than you're saving due to decreased productivity? Maybe. But that's hard to prove, and "This office proposal is $X million cheaper because we can lease three fewer floors" is very straightforward.