Tech Tenants Account For 22% Of Trophy Office Leases
When it comes to tech tenants, the lust for brick-and-beam office space could be fading.
As the attraction and retention of talent remains a top priority for office occupiers and available space continues to tighten in many markets, established firms in tech-heavy regions like Seattle and San Francisco are starting to turn to retrofitted office towers and trophy buildings as a viable option for new office space, the New York Times reports.
Tech, creative and media industry tenants have leased more than 8.5M SF in trophy buildings across the U.S. in 2017. This means the group leased 22% of all trophy space, an increase of 7% year-over-year, according to JLL.
As startup companies mature, their employee base is growing with them. While converted warehouse and brick-and-beam buildings offered the cool vibe desired by many startups, they can present operational issues to firms in growth mode.
Modern office buildings or newly retrofitted towers tend to be more flexible and can still be designed to include the open-floor plans, natural light and exposed ceilings that remain sought-after features.
Trophy buildings also offer the allure of being close to transit with access to amenities in and around the office.
Social media giant Facebook is one company getting in on this trend. The company recently signed a 436K SF lease for a brand-new office and residential tower in San Francisco, while Spotify signed a 378K SF lease to take space in 4 World Trade Center in Manhattan.