Why Price Doesn't Matter for Creative Office
There are conflicting opinions on what makes an office worthy of the creative stamp. It is just an open floor plan? Or maybe reclaimed wood and ping pong tables? We checked in with some of LA's top landlords and developers to get the real answer.
Bixby Land CEO Bill Halford (right) says his firm has done about 2M SF of creative office space, and he says there's one startling fact he sees in the sector: prices just don't matter. "It's just about creating a space tenants want to live in," he says. "Price goes out of the discussion for the right space." With Bill are Allen Matkins partner Peter Roth and PMI Properties partner Jeff Palmer.
Clarion Partners SVP Khalid Rashid (right, with Rick Buckley from LA Realty Partners) knows a thing or two about the topic. His company's i/o at Playa Vista hosted more than 300 commercial real estate pros this week for Bisnow's The Office Evolution. He says when the building was delivered in 2009, it just didn't meet market demand. Adding apartment-like amenities is really what allowed the project to take off, says Khalid. What kind of amenities really differentiate his product? Complimentary outdoor WiFi with a hammock setup.
Peter says the creative office revolution isn't just for Silicon Beach or the West Coast—it's global. Even companies overseas are doing away with the closed-door office and cubicle layout to create a more collaborative environment.
None of our panelists may have more background in creative office than Jeff, who has been working the space for more than 20 years. He says oftentimes too much is made of what is or is not "creative office" space. "It's really anything but your dad's office," he says.
Clarion's project, the former Latitude 34 complex, sat vacant for five years after opening, but has begun attracting tenants since the improvement Khalid spoke of. Fullscreen took about 60k SF in March, and WPP is moving into 49k SF next month. It sure doesn't hurt that Google and Yahoo have taken up residence nearby.
Tishman Speyer senior managing director John Miller (left) says it's all about authenticity. "Having an informed architect is the key," he says. Tishman's Collective in Playa is a five-building campus that measures about 205k SF and features top-notch amenities, including high ceilings, private gardens and sexy landscaping. John says the firm built 20 individual outdoor spaces capable of accommodating anywhere from 15 to 90 people at the project. That's how you get a company like Yahoo.