Colleen Werner is the Founder + CEO of lulafit, a company transforming office buildings with amenity consulting and management.
It’s no surprise that commercial real estate is facing new challenges in our post-pandemic world. In an effort to meet workers’ ever-evolving needs, landlords and companies are looking to leverage amenities to draw employees back to the office. Occupiers’ flight to quality—the desire to create engaging in-office experiences—started before Covid-19, in an era when employees didn’t have any choice but to go to the office. Amenities play an even more important role in the success of a property now as we work to entice employees back to the office.
We have long lived in an office environment where employees were obligated to go to the physical office every day. They were drained, burnt out and exasperated. The pandemic flipped the narrative on its head. Now, employers must answer the question, “Why should I come back to working in the office?” Landlords need to help employers answer this question as their office assets deteriorate in value. We all know employees require a better experience to make office participation a reality, but the question remains, how will landlords afford to add hospitality spaces into their office programs without burning money?
The answer lies in a simple truth: Amenities don’t always have to lose money, if done correctly. When you take off the blinders of the status quo and look at amenity programs as hospitality experiences, it seems clear how these offerings will rule office buildings in the future. With the right amenities, landlords can actually drive significant alternative revenue streams while also driving people back to the office. It’s a win-win.
This is the first in a short, three-part series breaking down the best approach to selecting (and monetizing) the amenities that are proving to be worth the investment.
Why Amenities Work
Over the past three years, the majority of the workforce has gotten equally comfortable working from the couch, the coffee shop or the traditional office, and workers everywhere want to retain their new-found flexibility. A study by Cushman & Wakefield shows that “most engaged workforces are those with autonomy over when and where they work.” Employees are looking for a third place to land. Employers and landlords who offer options through amenity spaces—whether it’s a communal work lounge or an on-site coffee shop—are creating environments that add value to the in-office experience.
Which Amenities Work
Recent data from Cushman & Wakefield shows leading companies taking up residence in buildings that offer options. Across the properties analyzed, there was an average of 14 amenities in each building, so it’s clear one or two changes won’t move the needle much. Based on my own company’s observations, the most popular amenities right now are on-site food and beverage offerings, meeting and event spaces, fitness centers and outdoor spaces.
Remember, though, that when you make the decision to update or create a hospitality experience, it needs to reflect the interests of your target audience. You can’t make decisions in a vacuum without getting buy-in from the right stakeholders.
How To Choose The Right Amenities
The key to maximizing the amenities above is twofold:
1. Choose the right offering.
Conduct a feasibility study to get input and ideas from the people who will be using this amenity. While it may sound appealing to bring in a white tablecloth restaurant, building tenants may prefer a different atmosphere, price point and speed. Don’t be afraid to get the buy-in; information is valuable and profitable. Also, challenge yourself to think outside the box. If you have a retail vacancy, consider building it out to suit a food and beverage provider on a management agreement instead.
2. Allow access for tenants and the public.
The right hospitality offering will serve employees in the building and those from nearby properties, not to mention residents in the area. In my experience, tenants value access and convenience, not exclusivity. They don’t mind sharing amenities with the public if they get priority pricing and booking access. So, while penthouse views from a treadmill are nice, gone are the days of burying amenities at the top of your tower. A gym on the ground floor can attract attention from building tenants and area residents alike. In this way, you’re able to charge one rate for tenants and another for the general public. My company has consistently found that the most impactful experiences are those that benefit the building and the larger community.
In the end, amenities are a great way to help bring people back to the office. But you can’t go along with what’s always been done—you have to challenge what you think you know and be willing to collect feedback. Having the right stakeholders helping solve a problem can help guarantee a solution’s success. By creating hospitality experiences that meet tenants’ needs and serve the greater community, buildings can capitalize on much-needed alternative revenue while we continue to build the future of workspaces together.
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