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Why The Push To Get Workers To The Office Is A Designer's Dream

The quality of an office space has become a key front in the war against remote work, and tenants and landlords are spending tens of millions of dollars to win the battle with posh, irresistible workspaces.

It costs an average of $400 per SF to build out the interiors at 830 Brickell, Miami’s highly anticipated office tower set to deliver next quarter, according to Brian Gale, vice chairman at Cushman & Wakefield, who leases space at the building. A standard office build-out used to cost $45 per SF.  

It’s not just at the brand-new tower — a tenant Gale worked with at 701 Brickell Ave. spent more than $600 per SF to finish its space, he said Thursday at Bisnow’s South Florida Office and Workplace Summit held in that building.

AEI Spaces’ Stefana Simic, Cushman & Wakefield’s Brian Gale, Nuveen Real Estate’s Charles Russo, G Alvarez Studio’s Gigi Alvarez and JRM’s Anthony Iandoli at Bisnow’s South Florida Office and Workplace Summit Thursday.

Firms are pushing the boundaries of what office space looks like, in the process giving a boost to an entire ecosystem, from architects to furniture manufacturers.

“The flight to quality is super real. [Tenants] will literally pay almost anything to get what they want,” Gale said. “The evolution of the office world, it's like the hotel and the condo markets have combined, because you’re trying to bring people out of their houses back into their offices.”  

Demand for quality spaces extends beyond interiors to the physical structure, pushing developers to shift their design standards to attract enough preleasing to get out of the ground. 

Expensive features that were once deemed unnecessary are being embraced as a point of differentiation, a marketing tool that changes how a prospective tenant sees a property.

“These ideas of integrating biophilic design, having more flexible living, these are not new ideas,” said Stefana Simic, partner at AEI Spaces, a Miami-based architecture and design firm. “Architects and designers have been proposing these ideas for decades, but they were always value-engineered out. 

“These companies are now investing in premium real estate with amenities that they have not considered before,” she added. “It's a survival strategy.” 

The strategy isn't just targeted at the rank and file of large corporations. The scores of deep-pocketed executives who flocked to Miami during the pandemic want to live near their office and work out of spaces that align with their vision of why they left places like New York and Chicago for Florida. 

The C-suite also got a taste of working from home during lockdowns, and now they’re demanding comparable spaces to come back to, Gale said. 

“They're sitting in their beautiful homes, and they don't want to come into the office,” said Gale, one of Miami’s leading office brokers. “They're not going to come back to commodity, low ceilings, small window space. They’re just not.”

What the demand for magnetic spaces translates to in practice runs the gamut of features. Rooftop gardens, outdoor green spaces, tenant lounges and first-floor restaurants are popular, but golf simulators, pet daycares and a curated and rotating collection of expensive art on display aren't uncommon. 

In a postpandemic world, connection and health are emphasized. 

“Wellness-oriented things, things that are experiential and that enable larger gatherings are helpful,” said Charles Russo, Southeast regional head of workplace at Nuveen Real Estate. “Also, that kind of Instagrammable moment type of feature where your project is always in the mix in some regard.”

Russo cited the Southeast Asian hot spot Komodo at 801 Brickell as the type of amenity that can keep a building at the front of peoples’ minds. Nuveen sold the property in October for $250M, the most expensive single-office asset to trade in Miami last year. 

WeWork’s Nicholas DeMarinis, Mindspace’s Gianni Piccoletti, Deco Capital’s Bradley Colmer, Urban-X Group’s Andrew Hellinger and Life Time Work’s Molly Walsh discuss how office space is changing to attract tenants.

Property owners in trendy neighborhoods like Miami Beach can lean into their surroundings to add cachet to their projects by leveraging nearby businesses as an extension of their amenities. In less popular areas, landlords have to instead focus on their own placemaking. 

The latter route is the one Andrew Hellinger, co-principal of Urban-X Group, had to follow to position the Miami River Landing Shops & Residences, a 2.2M SF property with 800 feet of riverfront access, 528 apartments and 346K SF of retail space. 

When the project began in 2011, an AMC movie theater was slated for the top three floors, but Urban-X instead opted for 118K SF of office space as the theater chain’s stock nose-dived and its future looked unclear. 

Miami River Landing’s shops and apartments are 97% leased, and Hellinger said Urban-X was “fortunate enough” that Jackson Health and the Miami-Dade County state attorney’s office took 75% of the office space.

Urban-X has continued to invest in upgrading its river walk and access to a diverse retail mix. Hellinger said that will be key to filling the last 34K SF of vacant office space, because the project’s location means it has to offer everything a trendy neighborhood has in order to attract a tenant.

“We’ve struggled, candidly, because we’ve been told we’re in between,” he said. “We’re in between Brickell and Wynwood, we’re in between Biscayne and Blue Lagoon and Doral. I’m hopeful that enough people will visit us as a destination where a broker will say, ‘Wow, what a lifestyle you’ve created for an employer and employees.’”

In Miami Beach, Deco Capital has leveraged the inherent strengths of the neighborhood to bring the 60K SF of office space at Eighteen Sunset to 80% leased ahead of its delivery next quarter.

Eighteen Sunset at 1752 Bay Road also includes 17K SF of ground-floor restaurant space and a rooftop pool deck where luxury watch brand Audemars Piguet has signed on to open a 12K SF retail lounge.

The pool has become a selling point for tenants, Deco CEO Bradley Colmer said. Tenants are already paying a premium to be surrounded by retail and water in Miami Beach, so Deco is focused on devising a plan for the property that activates the rooftop space while giving tenants a plush space to conduct meetings. 

The project was originally slated to be condos, but Colmer said the pivot to office while maintaining nearly the same amenity package had helped Deco find tenants and push rates.

“The fact that we kept the residential amenities of our building in place for the office use has been something that's helped us achieve probably the highest net effective rents on the East Coast of the United States south of New York City,” he said. “We’re pretty pleased with that.”

CORRECTION, JULY 1, 1:30 P.M. ET: A previous version of this article misstated the office occupancy at Miami River Landing. It is 75% leased with 34K SF available.