Wasnt this subject covered in a couple of different books like The Mythical Man Month (Frederick Brooks) and Peopleware (Demarco and Lister)?

In the development environments that I have worked and managed, I felt the work environment was important. I found that development work is focus work and developers need to concentrate. Nothing derailed the work like continuous disruptions such as placing the developers in cubicles within the call center or next to a noisy break room, two situations that I have encountered and rectified. Additionally, the developers need to be comfortable since many will work for hours in their space and they should be given the latitude to make that space comfortable and their own.