Your employees had the choice between drab isolating cubicles bathed in depressing internal lighting and something else, which they eventually chose. I think maybe you should reconsider what that means. Perhaps your engineers weren't as interested as other parries in pretending cubicles--no matter how fancy--are the same thing as offices.

Anecdotally, at my current job I prefer working in a room where there are from three to five other engineers and lots of electronics around over working in the cube I'm assigned, but if I had a genuinely private office with a window, even overlooking a parking lot, I'd take it and work there 99% of the time, and be more productive if past experience is any indication.