How Hard Data And New Technology Are Driving Chicago Office Leasing
Chicago’s office tenant brokers are depending on technology and data to drive users to the right buildings.
Analytics and digital tools are far more expansive than they were before the pandemic and are influencing how tenants make leasing decisions, panelists said at Bisnow’s How to Fill Your Building Summit at 25 East Washington. Brokers are leaning on commuting studies and geofencing, landlords are rolling out apps that capture building usage and sustainability metrics, and amenity providers are using data to fine-tune engagement.
“We’re just going into a dozen deeper layers than we did in our prior lives,” Savills Executive Managing Director David Mahoney said. “It’s required in this environment.”
The amount of available data and the methods to collect it have significantly changed in the last five years, said Brian Atkinson, managing director at Hines. Clients ask for detailed information on daily occupancy, common area usage and attendance across a variety of event types.
Apps now let tenants use their phones to access buildings, reserve rooms, order food and log work orders while also feeding back real-time data on occupancy and utilities. Hines’ technology also helps occupiers track sustainability goals and study their own usage, which wasn’t as easy to do before the pandemic.
“Tenants want to have a special environment,” Atkinson said. “If they're encouraging and they're investing in their people to come to these great buildings, they want them to have a great experience.”
Companies on the hunt for new space are also using data to evaluate their prospective landlords. Mahoney said he digs into different databases to understand who a landlord is and where their money comes from. He also evaluates how property owners fund tenant improvements and pay off debt.
Avison Young principal Jeff Lindenmeyer said he recently utilized technology that tracks foot traffic to help a tenant find a new location. The chief operating officer of a tenant he was evaluating space for dismissed one location as “dead,” so Avison Young pulled geofencing data from around the front door of the tenant’s current space and the property they were considering.
The brokerage found that compared to prepandemic numbers, there was just 32% recovery in foot traffic at the tenant’s current location, compared to 91% recovery in the new space. Lindenmeyer said the COO loved seeing the data back his anecdotal observations and that there wasn’t a bigger proponent of the new space after Avison Young’s presentation.
“Data drives decisions,” Lindenmeyer said.
In that vein, Lindenmeyer said you can’t tell a tenant where they should be. Instead, brokers have to evaluate how commutes would change for employees in different submarkets.
Lindenmeyer said his team spends more time on commuting studies than they ever have historically. Commuting patterns govern the submarkets that make sense for a particular tenant, and then the brokerage is able to look more critically at building health, amenities and services.
“We never really start submarket first,” Lindemeyer said. “We start tenant first.”
Colleen Werner, founder and CEO of Playbook, said owners want data to inform what they are going to build and what events to put on.
Her firm groups tenants into three buckets: C-suite decision-makers, influencers and administrative staff. Then, it tailors programming accordingly, from private dinners for executives to networking opportunities for rising talent. The goal is to ensure investments match the mix of employees in the workforce and create experiences that drive loyalty and lease renewals.
“We've got to arm ourselves with data to understand who they are so that we can start to customize and curate experiences so spaces like this don't have to change all the time. It's too expensive,” Werner said. “No landlord in the world can do a reposition like this every 10 years, but the things that happen inside of them can change.”
