Office Amenities Today Are All About The Talent War
Maybe it takes more than 150 years of combined commercial real estate experience to realize the desire for rooftop decks in office buildings is not going away any time soon. Neither are hotel-like lobbies with free WiFi, restaurants and bars, nor state-of-the-art gyms.
Developers are investing big dollars into amenities and spaces that were once only dreamed of in Atlanta's skyline. These spaces, like floor-spanning gyms or gathering areas with couches and community workstations that anyone in the building can use, also don't necessarily contribute directly to the rent rolls.
But without them, landlords have a hard time landing tenants, according to veteran commercial real estate professionals at Bisnow's Atlanta Office of the Future event Tuesday, many of whom have been in the business in excess of 20 years and have seen the evolution of what companies want in an office.
Heagy said landlords are simply responding to the pressure that tenants feel when it comes to recruiting and retaining a talented workforce, especially when those employees have every chance to jump ship to another company for better perks and work environments.
“If you think we're not in a major hunt for talent, you're kidding yourself,” Heagy said.
There is data to support these new office trends:
- According to a 2017 workplace study by the retailer Staples, nearly a quarter of all workers surveyed would agree to a pay cut for a nicer work environment.
- More than 80% of job applicants would outright reject a job offer if they didn't like the workplace, according to OfficeBroker.com.
- And 97% of employees consider the office environment as directly related to how their company values them, according to a British Council for Offices study.
New City President Jim Irwin said office developers in the past forced designs on the tenants, expecting them to fit into an office shell. What the employees may have found appealing was perhaps an afterthought.
“What we're finding is that employees … are saying, 'No. I have a choice and I am choosing something other than that contrived experience,'” Irwin said.
For some developers, the rooftop amenities need to appeal both to tenants and the larger public.
SJ Collins Enterprises is underway with The Interlock, a mixed-use project off Howell Mill Road in the Westside. One of the project's buildings is slated to include more than 200K SF of loft office and 90K SF of retail space as well as a rooftop amenity that took some consideration, Senior Vice President Justin Latone said.
The plan now is to split the 38K SF space into a bar and restaurant for the public and a private, members-only club that will include a swimming pool with Midtown views, Latone said.
Fitness centers are growing pieces, literally, of an office amenity package. Once Riverwood 200 was built and filled with tenants, there was one space left on the ground floor that remained empty.
Its developer, Highwoods Properties, was approached by tenants about using the 5K SF space as a fitness center much bigger than the one Highwoods initially established in the tower. In turn, the tenants agreed to share in the space's rent to create the even-larger center, Highwoods Properties Vice President Jim Bacchetta said.
“It tells you that employers will go the extra mile and pay extra to keep the talent,” Bacchetta said.
Bridge Commercial Real Estate CEO Jeff Shaw said developers and landlords are learning the lessons taught from the success and desire of companies that are actually willing to pay a premium to have both the flexibility and the cool factor of being housed in a coworking operation like WeWork or Industrious.
That prompted Shaw's firm to hire an in-house interior designer whose background was designing hotels and their amenity-rich lobbies in their efforts to modernize older suburban office properties.
“I think the real amenity is feeling good in your space, feeling like you're at home,” he said.