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Building Success

5 Future-Fluid Approaches to Tenant Retention & Attraction in the Age of COVID

Posted by Kai Thompson  |  October 27, 2020

Preface

The idea of Building Success should be viewed as both an action and an outcome. The action(s) being innovation + continuous improvement of indoor workspaces, and the outcome(s) being improved performance + productivity of our workforce. As discussed in The Space Between, due to the current challenges presented by COVID, the Commercial Real Estate industry is experiencing a push toward Healthy Buildings as a standard. In the end, the true objective is not just to have healthy buildings, but healthy people.

The extent of future impacts depends on what we do now.”

John Holdren

Speech at Harvard University Center for the Environment 3.21.2017

In commercial real estate futureproofing is best described as the development of risk mitigation methods in anticipation of adverse future events. Prior to the Pandemic, such efforts included tactics like increased energy efficiency, the imbedding of technological advancements, and variable responses to green building initiatives. While the current health crisis has clearly shown how ill prepared the CRE industry was to absorb such adverse economic impacts, it has also given us the opportunity to be more fluid in our approach to futureproofing our investments in the built environment. In order to assure our industry’s survival, we must foster more effective means of collaboration that not only capitalize on current trends but set the stage for us to thrive long after the current crisis has abated.

Here we look at 5 future-fluid approaches that workspace owners, landlords, and managers can use to maximize tenant retention and attraction.

1. Work Together

Even as new CRE management practices and technologies are being born from this necessary time of innovation, many challenges still exist in the relationship between facility stakeholders (owners, landlords, and managers) – each having different and sometimes competing goals. From ensuring the smooth day-to-day functioning of the built environment while meeting the real-time needs of tenants. To overseeing the investment and profitability of the entire building while mitigating risk and liability. To meeting financial targets tied to each building’s long-term performance. People usually have a stronger buy-in when they are included in the implementation. By openly sharing performance goals and working together to develop H&S protocols and risk mitigation strategies, buildings can function at optimal levels due to a shared understanding.

Consider This… 360 Facility Feedback

In this process, the stakeholder team receives regularly scheduled feedback on the building’s performance. Facility managers would see how current building needs translate into concerns or benefits for landlords and owners. Landlords see the benefits from or impacts to the facility manager’s day-to-day functioning, as well as any notable risk, liability, or cost concerns and how they affect the owner’s investment goals. Owners get to see not only how their building is performing, but the cause and effect relationship between their long-term investment goals and the efficacy of their landlord and facility manager team.

2. Trust + Transparency

In previous times, tenants and facility stakeholders didn’t always share or participate in a consistent message or unified plan. From building improvements and increases in rent, to new maintenance protocols and H&S initiatives, inclusion is a reasonable expectation. By informing tenants about what’s happening in their building – the different procedures being put into place and what the process will look like – you not only build trust but provide a sense of security and level of ownership as well.

Consider This… Automated Monitoring + Reporting

What COVID responses and the current social climate has shown is that daily reporting in a central location helps deliver consistent messaging and increases the level of trust. This can be accomplished by creating a customizable dashboard – accessible by tenants and facility stakeholders – to provide updated information on air quality, contact tracing, cleaning + disinfecting.

3. Flexibility

Historically, when negotiating lease terms, the goal between tenant and landlord/owner was to lock into a 5 to 10-year contract under a pre-determined amount. This model insured a fixed cost for tenants and a dependable revenue source for owners. Tenants who could confidently commit to these agreements had business plans and revenue models that more than supported such a sizeable investment. However, we are now in a time riddled with numerous unknowns and businesses are being reasonably cautious.

Consider This… Variable Space Utilization Options

None of us knows what tomorrow holds or how our use of space might shift and evolve yet again. While workspace owners and landlords will have to choose what approach suits them best, offering multiple options will help maximize occupancy by diversifying their tenant pool. Solutions might include short-term leases, options for subletting and shared workspaces.

4. Cost vs. Benefit

Once based solely in metrics such as price per square foot, maintenance costs, and operational overhead, a cost-benefit analysis must now also consider whether a specific space provides benefits that minimize a newly inherent risk – an unhealthy workforce. This shifts the conversation from space generated revenue to tenant retention and attraction by exploring what a profitable space looks like in the future.

Consider This… A Healthy Workforce + Enhanced Space Performance = Sustained Profits Over Time

By enhancing overall health and safety of the built environment, space performance becomes a tool that effectively serves both current needs while increasing future profitability. To that end, desirable amenities would include touchless technology to support a mobile experience for tenants, destination dispatch for visitors, and door-to-desk tools for employees.

5. Ease of Protocol Implementation + Maintenance

In the age of COVID, the need for streamlined and efficient communication processes has become more urgent than before. As the need for safety procedures increases, i.e. health screenings and contact tracing, so does the need for timely communication in order to safely proceed with typical business.

Consider This… Tech at the Outset

The successful implementation of building protocols depends heavily on how easy it is for tenants to participate in once established. A useful solution would be an integrated, tenant-accessible dashboard capable of tracking space performance and utilization, cleaning and sanitizing measures, maintenance and repair requests, and exposure risks. In conjunction with a comprehensive onboarding process where tenants can get all their questions answered, gain familiarity with building amenities, and understand what data is collected, this approach would ensure compliance and streamline issue resolution.

By working TOGETHER, workspace owners, landlords and managers can better meet the needs and wants of tenants and establish a foundation for building success.

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