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The Office Building Evolution For A New Breed Of Office Worker

Forbes Biz Council
POST WRITTEN BY
Christopher Kelly

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Today’s consumers want more than transactional relationships with companies. They’re now evaluating brands according to how it feels to do business with them. The superstars of the experience economy — companies like Ritz Carlton, Apple, Zappos and Disney — are not just selling hotel rooms, phones, shoes and vacations. They engineer memorable experiences and emotional connections that build customer loyalty.

So, how does this relate to the commercial real estate industry?

Historically, it hasn’t. The nature of long, contractual lease terms has prevented the real estate industry from being as customer-centric as other industries like retail and technology, where loyalty is earned day in and day out. So long as the C-suite had the corner offices and heads of real estate were wined and dined, leases got signed. Those days are coming to an end as lease terms are getting shorter and CEOs are increasingly at war for talent who are demanding an improved quality of life at work. This inversion of power and influence in the workforce is reshaping real estate decision making, and smart landlords understand that helping companies attract and retain talent is the best way to attract and retain tenants.

Employees Are Also Customers

A new breed of workers, connected to the office 24/7/365 via new mobility policies and technology, has a different kind of relationship with employers — one predicated on the notion of an “always on” work culture. If employees are expected to be available all the time, then both employers and landlords must rethink what work-life integration actually means. As the co-founder of a workplace hospitality platform, I see the elements of workplace design that must be considered by landlords who want to achieve this integration.

Approaching workplace design with a focus on how it feels to be at work is the quickest path to becoming a great employer. Failing to do so will put employers at a severe competitive disadvantage, because the best talent gravitates toward employers that understand the vital importance of workplace amenities — ones that go beyond Ping-Pong tables and beer taps. The right workplace design not only attracts and retains employees, but also improves collaboration and productivity. It only makes sense to give people the freedom to work from wherever they do their best work. Think about it: When we were university students, our professors never graded us based on where the work got done. Group work might have happened in a café. Teaching and learning happened in our classrooms. Heads-down studying could happen in the library, under a tree or lying in bed.

A great office needs all of this and more. You need common areas for mingling, having coffee and enjoying meals together — spaces for group work, decision making and learning. And of course, quiet areas for concentration.

But not every employer has the resources to create an Apple or Google-like workplace. For most companies, the only way to compete for talent is if their landlord is able to leverage the scale of a building to recreate a better building experience through on-demand spaces and a shared consumption of amenities. According to Colliers International, in the past, 3% of commercial real estate was dedicated to amenities such as gyms and dining. Now, owners should plan on allocating a minimum of 10%, and will need to go to 12% or higher to compete for the most sought-after “anchor” tenants.

'Lifestyle' In An Office Building

Much like the headquarters of the world’s largest brands, office buildings of the future look and operate like full-service lifestyle hotels. Landlords will act as curators of experiences within buildings. Thus landlords will become brands, and tenants become members. And real estate starts to become de-commoditized, selling experience rather than square feet.

This makes the amenities, like those enjoyed by big tech companies, more financially feasible. Landlords must keep pace with the trailblazers in flexible workspaces and offer office buildings with shared services, amenities and a variety of workplaces where companies can rent a desk, office, floor or meeting room by the day, month or year.

In most office buildings, the front desk feels like a TSA interaction, and the ground floor retail faces the street, drawing energy and attention away from the building. But what if the lobby, where the experience begins, felt more like the front desk of a hotel, and the ground floor retail was curated based on the greater contribution to building tenants?

In a hotel, the conference and amenity floors are available to all and help the property connect to the local business ecosystem. Likewise, an amenitized common space in an office building might offer a gym, a cafe with healthy food, a lounge, green space and a game room, as well as flexible work areas that allow tenants to expand and compress their real estate footprints according to their changing business needs. Add coveted service amenities — laundry service, massage, hair cutting and nail salons — and your workplace is looking less like a cubicle farm and more like a community with a vertical campus that offers anything tenants need to live, work and play within one building.

A Community Of Tribes

Employees may be spending more time at work, but they still crave a “third space” to connect with others or work independently in a social environment. These are the places where people get away from the office without having to go away from the building. Coffee shops and soft seating in the lobby can act as a living room to the building and serve as a temporary escape from the office and a permeable layer of the building that welcomes the larger business community with a gesture of hospitality.

We believe that the trend toward better experiences does not just apply to consumer brands, but also the ones maintaining or reimagining the built world. Employees are also consumers and demand more from the companies they work at as well as the buildings they work in. Landlords and developers who understand this trend will be the next generation of marketplace winners.

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