Communication and team bonding. I've regularly worked with teams that spanned across multiple offices, and without doubt there's huge communication barrier introduced with distance.

Even development teams which are split across different locations in the same building see this problem (to a lesser extent). It's one of the main reason investment banks will put developers on the trading floor, seats on the trading floor tend to be very expensive (everything has multiple redundancy, etc) but the teamwork advantages are so great that it's worth doing.