Spring ‘24 Tenant Experience Trends and Forecasting What’s Ahead
Headlines about the office are drastically different than six months ago. Across the board, owners and operators feel the worst is behind us with a sense of positivity ahead. Even better, 55% of companies say they’re expecting to bring more people back to the office in the next 6 months.
Whether companies are maintaining or increasing the time their employees are encouraged (or mandated) to be in office, one thing is clear–companies are still figuring out how to execute their hybrid work visions while owners and operators are finding ways to support and partner with company leaders.
Here’s a glimpse at the top office trends and what’s expected to emerge in the season ahead based on our research and my conversations with our customers and tenant leaders.
Hybrid is the norm, but it’s not without challenges
59% of companies say their employees consistently work across the expanded workplace, including from home, flex spaces, coffee shops, and more. While companies and their employees have settled on a hybrid work truce, with 62% of companies operating within this strategy, it's not without challenges for everyone.
In a recent podcast interview, Emma Goldberg of the New York Times talked through the employee upside of the hybrid work model, from family flexibility to saving time on no-commute days. Despite the perks, employees are feeling more disconnected and discontent than pre-COVID. Why? Added uncertainty. Employees are often calculating the balancing act between home life obligations and the latest in-office policies.
Tenants Want Partnership
When we asked company executives what factors most positively impact their sentiment of their workplace building owner or operator, the top response was partnership to improve the workplace experience for their talent. Alternatively, a lack of partnership is also a top sentiment detractor. Neil Vogel, the CEO of Dotdash Meredith was quoted as saying “We believe that teams who stay connected to the workplace are teams that will stay connected to each other. And we need a bridge to do that,” when asked about how the workplace impacts company culture at Dotdash Meredith.
As an owner or operator, how can you understand and support your tenant’s workplace strategy? Start with localized data; survey your tenant leaders to understand their unique requirements. Workplace needs are not monolithic—from access to flex spaces to safety and security, ESG, and engagement activities for employees, tenants face challenges globally but not universally.
Mobile Access is the New Normal
Here at VTS, we continuously talk to owners and operators who are amid transformational access decisions and investments. They want to modernize access but each building has existing systems and point solutions. For example, readers that may or may not be compatible with a desired mobile access experience, access control systems for the building, workplace suites, and other spaces...it’s a complicated web to untangle.
Here’s the tenant decision-maker’s perspective.
- 87% of tenants are focused on building safety and security when considering new office space to lease or renewing their current office space
- 53% of tenants say they want mobile access to their office building
- 31% of tenants say coordinating and setting up building access for employees and guests is a top pain point
The time for owners to wait on the mobile access sidelines is over. After years of investment throughout the industry, mobile access now delivers a superior experience over keycards, and we will see the number of employees who want to #killthekeycard increase. Delivering a modern mobile access experience is a start, but modernizing how access and credentials are managed is an incredible time savings and delivers a superior experience for both property teams and tenants.
And, because each building has unique needs, they need a partner with a built-in and flexible integration layer to intake various access control systems. Imagine the power of managing access at the building, the suite, and across other buildings, all in one central view, syncing to various access control systems. Forward-thinking owners and operators see the opportunity and revenue this can unlock for them and their portfolios.
So what’s ahead?
All hope is not lost for hybrid work, with both companies and employees actively trying to navigate the challenges and overcome the disconnect. We predict both an influx of office demand this spring and for companies to continue to bring people back to the office. Through February 2024, VTS’ office demand data shows that national office demand was up 27% vs. the same period in 2023. While still 35% below pre-COVID levels, key markets such as New York City and Los Angeles have started the year at or above pre-COVID levels. No matter what cities and regions your portfolio is spread across, here is a preview of what to expect.
Doubling Down on Getting the Basics Right
As detailed in the Global Workplace Report, amenities are nice, but they don’t matter if people experience recurring maintenance issues in the building or a lack of basic operational communications. At the end of the day, seamless and safe operations are the foundation of any tenant experience.
As a result, we expect owners and operators to continue to centralize and consolidate their tools. Managing a disparate email tool and a separate work orders system is not only a hassle for property teams, it ultimately detracts from the experience your property teams deliver to tenants.
Managing Supply and Demand of Flex
People need more from their workspaces as they navigate hybrid work and stronger in-office policies–collaborative workspaces are an incredible tool for companies. When the office is a bit too full, when a big meeting or workshop is coming up, and even to bringing together smaller hubs of employees, we expect to see a resurgence of flex spaces.
Tenants express interest and demand for flex spaces, but supply and demand are constantly in flux as companies shift their strategies, and bring people back. Because of this, owners and operators often turn to a 3rd party operator and expert to help guide them.
Making Space Adaptable
To offer flex or not isn’t actually the question. The real question is…how can owners make their offices and the space within them adaptable so they can shift as the market, technology, and tenant expectations do?
The answer is all in the tech that owners and operators use to support them. Flexible, scalable, centralized technology will prevail against point solutions. This all compounds as we see asset classes converging. The office experience continues to widen, as people expect retail, food, and beverage options near the office, as they work from home or flex spaces during the week, and ultimately, as the tech experiences we all engage with in our daily lives become more sophisticated.
By making space adaptable, owners, operators, and tenant companies can continually adapt, create more engaging, dynamic work environments, and meet tenants’ needs for more efficiency and collaboration.
