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16A— February 24 - March 9, 2017 — Commercial Office Properties — M id A tlantic
Real Estate Journal
NAI J ames E. H anson
By Scott K. Perkins, SIOR, CCIM, and Judy Troiano, CCIM, NAI James E. Hanson Forced change within and among suburban office buildings T he rise in popular- ity of suburban of- fice buildings began
space planners alike. Make no mistake, there are millennial decision-makers re- locating to suburban markets. The numbers are perhaps far fewer than those choosing urban markets, but they are there and we must be able to provide them with some or all of the conveniences they desire if we want to attract these companies. How might we do this? To begin, we need to ask our- selves a few questions: Is the office building which lies on the fringe of the suburban submarket competition for a similar suburban office build- ing that is located next to pop- ular retail and restaurants? The answer is maybe. While one particular building may not be the closest to the area’s retail, perhaps it is LEED certified (to a gold or even a platinum standard). Are there amenities within that fringe building that would appeal to the millennial employees (dry- cleaner, fitness center, café, a revitalized lobby with WiFi, a coffee bar and health food area that allows for casual meet- ings, etc.)? Are there sections outside of this fringe building where employees can unwind; walking paths, a park, a patio? Is there a bike rack to encour- age biking instead of driving? Millennials are tech-savvy, diverse, optimistic, collabora- tive and adaptable. They also have both starting salaries and crushing student debt. They are a fiscally-conscious segment of the population that are driving about 20% less than their baby boomer parents did at the same age. This small but telling statistic should be of interest to land- lords and local government officials alike. There are many suburbs that do not openly “encourage” biking. Provid- ing safer travel for bikers by stripping roads with bike lanes and/or placing signage such as “Share the Road” would be a very good start. To lower the vacancy/avail- ability rates, landlords must be proactive, collaborative, creative and informed. But mostly, they must embrace change. And while change is of- ten difficult, it is a necessity if one wishes to stay competitive. Scott K. Perkins, SIOR, CCIM is managing director of corporate services, and and Judy Troiano, CCIM is senior associate at NAI James E. Hanson. n
to a new segment of society that will transform how (and where) we will work in the future. I n j u s t
the millennial’s requirements of a healthy, live-work-play environment and the picture becomes ever more muddied. Are there restaurants within walking distance? Is retail nearby? Is the building LEED certified? Are pets allowed? Are there places close-by to “hang out” and unwind? Does any culture exist? Buildings within urbanmar- kets have many, and possibly even all of the desired ameni- ties listed above. Most office buildings within suburban markets do not. And while some of the suburban short- comings can be addressed
quite easily (“Pet friendly? Why yes, we are!”), others can be far more difficult to replicate or achieve, especially within a reasonably short timeframe. What does this all mean for the landlords, communities, corporations and local govern- ments within suburban mar- kets? The answer lies partially in adapting to new social and economic realities. Some office buildings will ultimately be demolished while others will be repurposed. We must all get creative – landlords, tenants, real estate advisors, govern- ment officials, architects and
in the 1960’s and contin- ued unabat- ed through the 1990’s. Baby boom- e r s d r o v e much of this d e m a n d . However, as
s i x y e a r s , millennials (those born after 1982) will make up mo r e than 50% of the global work-
Scott K. Perkins
Judy Troiano
this group of workers readies themselves for retirement, it will be necessary for landlords to rethink the workspace being left behind. This evolution of office space is due, in part,
force. The majority of these workers prefer Transit Ori- ented Developments or TOD’s. This one dynamic alone is sig- nificantly changing the office leasing landscape. Add to this
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