If you want me to work remote full time, I need a raise to cover the cost of getting an apartment or house equivalent to my own but with an additional room to turn into a dedicated private office.
Otherwise, I'll take an appropriately designed office.
I agree there's a need to separate work and life. I really struggled with WFH until I got some designated space to do it. I'd imagine that's not uncommon.
That said, whether it's worth it depends on how you value your time. Not sitting in traffic an hour each day ~20 days/month, if you value your time at even $30/hr (entry-level contractor in midwest, say), it should cover the cost of the extra space.
If not, well, you also have to factor in being able to use your own kitchen and especially bathroom. Ever since working from home for the previous few years, it's so awkward now having to go shit and piss in grungy toilets a foot away from my coworkers and managers. Would definitely pay some big money to avoid that.
Otherwise, I'll take an appropriately designed office.