Cement colored offices make people sad, but you don't get much done at a coffee shop.

I think that making your office space awesome (e.g. Google's Tel Aviv office in particular – http://bit.ly/1ePziyy) is the ultimate solution. You need a place where people can be creative but productive, and still interact with others around them so that they don't feel alone and depressed.

If you want the best out of people, you need to give them the best.