Helipad Yoga and Rooftop Squash Courts: Office Amenities Adapt to Pandemic
Helipad yoga, outdoor squash courts and in-building hair stylists have become the newest focus for landlords hunting for ways to adapt their office building amenities to the coronavirus pandemic to keep and lure new tenants.
From outdoor fitness classes and meditation sessions to personal tracking devices and app-based cleaning services, employees may steadily return to an office vastly different from the one they left behind before cities across the country implemented their stay-at-home orders. With the renewed priority on safety and preventing another outbreak, buildings are trying to be creative in how to welcome workers back while ensuring they can continue to attract new tenants at the highest possible rents.
"It's cool to get market rents, but it's better to get above-market rents," Jonathan McLaurin, senior director at investment management firm USAA Real Estate, said on an Urban Land Institute panel about the future of office experiences. "The purpose of placemaking, or that creation of an atmosphere, is to assist tenants with recruiting top talent, retaining their employees and boosting the productivity of their workforce. It creates an atmosphere where economic costs become a secondary component."
A number of landlords and building managers have already adopted out-of-the-box approaches in terms of updating staples of the office environment such as door handles, desks and conference rooms. And now, that new-age mentality is focusing on ways to retool office amenities.
For years, developers and landlords invested heavily in incorporating high-end amenities and programming into their properties in an attempt to lure tenants and drive rental rates. That's more important than ever now because, according to CoStar data, rent growth has slowed considerably over the past several months, and tenant leasing and activity faces a steep dropoff for the remainder of the year.
In top markets such as San Francisco, developers used to rely on tenant perks, such as luxury fitness centers operated by Equinox, in-house restaurants operated by Michelin-starred chefs and activities like rooftop happy hours, in their pursuit of new leases and continued rate growth. But with new restrictions brought about by the pandemic, Tom Larance, brokerage JLL's head of experience management, said those same group activities that used to help justify those above-market rates aren't coming back anytime soon.
"Experiences are more necessary than ever to be competitive in the market," Larance said at the panel on Monday. "In the wake of COVID, in my experience, we are finding that experiences are changing so, so quickly."
Take outdoor space, for example. Larance said it has always been an important amenity, but JLL has seen demand for it grow as it gets redesigned for the COVID age. For example, building managers are adding activities like tennis or squash courts that can still keep workers safe given the lessened risk of transmission outdoors.
They are also looking for new uses for outdoor amenities, from patios or roof decks. And they are even repurposing amenities that aren't standard hangout areas such as helipads for yoga sessions, where the building top breezes and views can be energizing for those who don't have a stress-inducing fear of heights.
Simple updates like new furniture or adding shaded spaces can also revamp an area that was otherwise neglected, such as a rooftop, outdoor plaza or private open space.
Beyond the outdoor, other changes are being made to update the in-office experience and amenities on offer in an effort to reduce crowding and eliminate or monitor high-touch areas. Technology-based services such as apps to request cleanings or monitor the number of people in the fitness center are being added to minimize crowds and promote safety. That has also meant adding services such as contact-less deliveries and package retrieval, or single-serving or pre-wrapped catering for small groups.
Landlords and building managers are also thinking of ways to eliminate the need for employees to venture off site. One proposed solution is to hire in-building medical professionals, hair stylists and shoe repair specialists, or provide services such as dry-cleaning delivery to make it easier for tenants to stay in the building for the duration of their workday.
It's too soon to tell whether any of these changes could have the effect landlords desire in bringing workers back into offices and businesses back to the leasing desk. Many tenants that operate out of offices are encouraged by public health officials to continue to keep workers telecommuting from home.
Larance said he's seen firsthand how curated programming and elevated design capture's tenants' interest in a space, and the big question now is how to do that while balancing elements like partitions, signs and social distancing reminders.
Annie Bergeron, a principal and design director for Gensler, said it may seem like a trade-off between safety and a high-end office experience, but good design is a critical value-add feature that doesn't have to be discarded for the sake of keeping employees healthy.
"Design makes the difference and is a critical component to a good experience," Bergeron said. "When we deliver better environments from an experience point of view, profits and the return on business rises."
