I recently moderated a panel at the Colorado Real Estate Journal’s 13th Annual Property Management Symposium. The panel, comprising Doug Wulf of Cushman & Wakefield, Jamie Gard of NGKF and Alec Wynne of Avison Young, was focused on the competitive nature of office spaces in the current market.
Our discussion centered on a particular buzzword within the millennial population: collaboration. Many buyers in the current market are investing in exercise facilities, collaboration spaces, game areas and other open areas where employees can work together in a more relaxed and “fun” environment.
Having been in the industry for years, I needed to understand two major questions – why is there a need for “fun” at the workplace, and why are owners spending money getting rid of rentable square footage to create these “fun” areas?
Normally, I would never advise a client to take rentable square footage from a building to increase common areas so that employees can play games. My philosophy has always been to encourage productivity; people focused on their specific goals and working to achieve those goals.
Currently we are a multigenerational workplace and never before have we been so interested in all employees having fun when they came to work. So my question for the panelists was, “Why are we doing this?” It seems strange that we’re getting ready for millennials when the last baby boomer will not retire until 2029, not to mention the Gen Xers.
Here are some highlights from the panelist answers:
- First and foremost, brand your building. Not every building will become more competitive by implementing these new trends if the existing tenants and the type of property is conducive to office-intensive tenants, such as lawyers, oil and gas, etc.
- Buildings that have an open concept will attract tech-savvy tenants that are open to a new way of thinking.
- Owners are looking for the advantage over comparable buildings in the market, and a building with more amenities will be more desirable.
- The lobby should be updated to have comfortable and bright seating areas, privacy seating areas, plenty of power so people can plug in, flat-screen TVs and Wi-Fi connectivity. The lobby becomes a collaboration space as well.
- Conference rooms are out. (To clarify, I don’t agree with this, but the feeling is that they are wasted space that don’t get used.)
- Market-ready spaces are trending. In the past, you would build out 3,000 to 5,000 square feet of office space so a tenant could rent immediately. The spaces would be built with kitchens and other amenities that would entice new tenants. However, in our discussion, market-ready spaces now are being built at 10,000 to 12,000 sf or full-floor spaces. If you are not creating market-ready spaces, there is a good chance you are sitting on space much longer and losing out.
- White-box spaces so tenants can visualize the space better. If a space is vacant, demo it: take out all the old walls, carpet, etc., and keep the space open and bright. Paint the walls, prepare the floors and make the space a visual beauty to entice new tenants. Tenants cannot visualize their occupancy if they are asked to go into an old vacant space. Make your space stand out, and be one that they will remember.
- Exercise facilities are trending. All of the competition is considering building a facility or already built one.
- Collaboration spaces are important; the concept encourages people to become more synergized and excited to be at work. Collaborative spaces create better flow of communication, resulting in new ideas and new concepts.
- Game rooms, bistros and other food areas are popular. Everyone loves to play games and eat. Who could argue that?
- Think: dogs at work.
Although all of the panelists agreed on the above topics, I have to play devil’s advocate and bring attention to why everyone is supposed to have fun at work. Weren’t we all hired to do a job and for this we get paid? Why are we so concerned about the fun factor? As generations change, the younger group wants fun – to work and play in the same place.
Fun and games break down the barriers between departments, according to an article from Forbes on millennials and fun. “This creates a more open and communicative atmosphere, and consequently a more creative and productive workplace,” the article said. “If colleagues are able to freely share and exchange ideas, like friends over a cup of coffee, rather than remaining isolated individuals, companies can shine.”
The panel discussion was extremely informative and collaborative (see, I’m learning), and we could have kept the conversation going for another hour. However, I still wonder about productivity. There are some statistical reports that say these spaces increase productivity and then there are some that say productivity declines. Unfortunately, that concept will have to be discussed in another panel. I’m late for the pingpong tournament playoffs.