Project515 panelists discuss today’s CRE office market
Companies seeking ways to lure workers back to office, one panelist says
KATHY A. BOLTEN Aug 31, 2022 | 12:21 am
3 min read time
622 wordsAll Latest News, Real Estate and DevelopmentLeaders of companies that occupy office space are looking for ways to bring workers back to workplace – if not full time, then two or more days a week.
To do that, they need office space that is inviting and user-friendly, panelists in the Business Record’s Project515 virtual discussion about the office sector said.
“Prior to the pandemic, there was this whole idea … that entries to buildings were geared to guests,” Todd Garner, principal at Substance Architecture, said during the Aug. 25 event. “Now it’s ‘how do you cater to your employees?’ … Companies want to give employees a reason to come back to the office.”
Companies are tackling the issue in different ways. Some have added rooftop patios, others large collaboration areas equipped with state-of-the-art technology. Some are adding coffee bars, workout areas and spaces with views to the outdoors.
A decade or so ago, when companies added fitness areas, the spaces were in the basements.
“That’s not the case anymore,” said Justin Lossner, a managing director at JLL’s Des Moines office. “If you’re in a high-rise, your fitness center needs to be at the top of the building. It’s got to have a premier view.”
Panelists in the Business Record’s Project515 virtual discussion were asked to share one or two words they would use to describe today’s office market. Here are their responses:
Todd Garner, principal, Substance Architecture: “I think the one word for us regarding the current state of office space is ‘reimagined’: everything from how employees start their day, end their day, arrive at the office to the various spaces within the space. [Office space] is becoming much more experiential. … People want to come to the office and the space has to be reimagined for them to be together.”
Justin Lossner, managing director, JLL Des Moines office: “Cautiously optimistic. We’ve seen a big change in activity over the last year. … Things are starting to stabilize, which is good. There’s certainly still a lot of challenges that we’re going to face over the next 12, 24, 36 months but we’re definitely starting to see an uptick. The logjam is breaking. For two years, we had a lot of … short-term renewals, and that’s really starting to change. So cautiously optimistic.”
Jackie Nickolaus, senior developer, Sherman Associates: “The word I would use is ‘transitioning.’ We know where we were. Many [businesses] don’t quite know where they’re going yet. But we’re in that transition phase when we’re trying to figure out what it will look like on a day-to-day basis.”
Andy McIntosh, vice president, development, McGough: “It’s kind of a dark word, but it is ‘murky.’ Not because the outlook is dark, but just because there’s a real lack of clarity, whether you’re looking market to market or even business to business. And so, if you are a real estate developer and investor, I think there’s a lot of murkiness yet about what the future use of office is.”
Mark Rupprecht, president, R&R Realty Group: “My word would be ‘changing.’ I think a lot of things go through cycles. Certainly, the office market is changing. … Leaders want people back in the office; workers want flexibility. That’s why hybrids have been working. We’re in a tight labor market and I think people are [wondering] ‘What can I do in my office space to bring people back?’ There’s also this looming recession. … What we hear from a lot of our customers is that they believe office space – whether that’s collaboration, communication, mentoring, training people as they onboard – is here to stay; it’s just going to look a little differently.”
More online: To watch the Project515 panel discussion on the office sector, click here.