The American office landscape is changing. Until a few years ago, coming to the office on a daily basis was expected of every employee, and everyone worked from his or her own dedicated space. Then, as the tech industry and startup culture took over the imaginations of the corporate sector, things began to change.
Millennials will soon account for half of the global workforce, and they have different expectations of how offices should work. Millennials are also more comfortable switching employers every few years, so there is an increased incentive for employers to offer the kinds of perks that encourage employees to stick around for the long term.
Universal Internet access has made it easier for employees to telecommute, whether from their home computer or from their phone while on the go. But after an initial rise in the popularity of telecommuting, employers are finding out that there are concrete benefits to having employees come to the office: more efficient communication, facilitating the exchange of ideas, and helping to promote a sense of company culture and belonging to a team.
In general, modern office spaces have become less formal, with less separation between employees, and with the aim of creating a collaborative and “campus-like” or “hotel lobby-like” experience. These trends have gained popularity not only in urban areas, but also in suburban office parks.
Commercial developers have taken note of these changes, and are trying to accommodate the needs of 21st century businesses by providing the kinds of spaces companies will want to move into. Gone are the days of being able to take an empty, nondescript commercial space, line it with cubicles, and put the office up for rent. Modern employees are interested in having a wide range of spaces for different purposes: individual focus spaces, collaboration spaces, socialization spaces, and even recreation spaces.
Now, developers are paying more attention to architecture, interior design, and the building of versatile spaces that inspire employees and foster a sense of collaboration. Developers are also looking more carefully at how to combine retail spaces in a way that raises their value—buildings with coffee shops, day care, yoga studios, and other similar amenities on the ground level can quite literally increase the value of the office spaces located above them.
Developments in technology are also changing the workplace. Millennials are unarguably the most technologically-savvy generation to date, and they expect technology to facilitate their work life as much as it does their life outside the workplace. One recent article summarizes the possibilities for future technological developments in the workplace thus:
“Real-time real estate […] could one day provide workers with information on conveniences (like whether the espresso line is too long on the third floor, or which bank of elevators has the longest wait) as well as opportunities for collaboration. For instance, it could let you know if your team members are eating lunch together in the cafe, or when an expert colleague usually based elsewhere has entered the building.”
How should modern developers and commercial real estate investors approach the changes to the modern workplace? Many developers have embraced these changes, building spaces that appeal to modern workers, and making major investments to update aging buildings to meet these newer standards. These kinds of investments can help to separate a building from the competition, and enable developers to charge higher rents and keep vacancy rates low.
However, because the modern workplace is changing so quickly, it’s also important to think about versatility—developers need to create unique office spaces that will appeal to companies, but that are also versatile enough to be adapted to a wide range of clients and trends. Similarly, developers should invest in the latest technologies, but, because of the rapidly changing technological climate, also remain flexible, as to not be locked into a particular technology infrastructure, should it be replaced by a new one.
As an experienced investment advisor for family offices and high net worth foreign and domestic investors, RMC Realty Advisors can help to formulate strategic development, management, and leasing plans to ensure that commercial spaces remain in high demand in the modern business environment. Contact RMC Realty Advisors today to get started.