In a Tough Office Market, Tenant Experience Programs Give Landlords an Edge

With nationwide office vacancy still on the rise and absorption forecasts looking dim, landlords across the country are searching for ways to distinguish their assets and secure tenants in a highly competitive market. In many cases, that means borrowing a page from the hospitality sector by turning the office into a destination where employees seek out an elevated work experience.

To that end, property managers have begun offering curated tenant experience programs designed to bolster the overall building experience for tenants, complete with activated amenities, events and tech-enabled customer service.

“When we receive requests for proposals on property management services, the vast majority of those today include a component of tenant experience,” Brett Williams, senior managing director of asset services at Cushman & Wakefield (C&W), told LoopNet.

Williams said C&W has been expanding the services offered by its Presence tenant experience program to answer the call from landlords looking for that extra something that will give their assets a much-needed edge in what most agree is a tenant’s market.

“We want to learn about what their goals are, and what the problems are that they’re trying to solve,” Williams said. “What are they trying to achieve? What’s the makeup of the building, what are the physical amenities that are there or not there? And then we build a program.”

Williams said that while each program is tailored to a specific client’s needs, the solutions they offer are all built on three key pillars:

• Relevant, valuable amenities.
• Human-centered engagement.
• Tech-enabled platforms.

New office builds coming onto the market have the latest amenities, so Williams said many owners of existing office stock are taking space out of their leasable area to convert it to amenity space. He said his team sends a survey to all building occupants to help landlords make important decisions about where to spend capital on tenant amenities.

“It can be everything from a small space to a full floor,” he said. Common upgrades include expanding and modernizing conference facilities, adding flex or coworking space and building out fitness and well-being rooms.

Another common preoccupation for landlords these days is food service.

“Unfortunately, during COVID-19, buildings were unoccupied, and a lot of our food service providers went away,” Williams said. “A big struggle today is how do you get food service back into the buildings.”

Whether it’s fitting out new food service space or simply finding the right provider to operate existing space, Williams said it’s important to be creative in generating excitement around your building’s food offerings. In some cases, that might even mean rotating providers throughout the week.

“Maybe you're bringing in the local mom-and-pop restaurant that everybody's excited about one day a week to serve their food, and then you've got other things on the other days of the week,” he said.

More than simply building out amenity space, Williams said landlords want someone to activate those amenities so that they’re worth leaving home for.

“They don't want a conference room sitting there with no excitement around it. They don't want a fitness center that nobody's using,” he said.

He said it comes down to “getting people energized to leave their home office, leave the barking dogs, leave the ability to walk to your kitchen and get lunch, and get back into the office and, hopefully, be more collaborative and more productive.”

With a focus on creating connections and fostering wellness, tenant experience managers partner with clients to develop and manage tailored programming that activates a building with events and personalized service.

“We see ourselves as a large part of the S in ESG,” Williams said, referring to the social aspect of corporate policy. “We want to make a community that people want to be a part of so that it's something special to be there.”

He pointed to the Lincoln Centre in Dallas, Texas, where a member of his team remains on site throughout the week to provide hands-on customer service and oversee daily activations in the building, much as a concierge would in a hotel.

“We're looking for that elevated experience that goes above and beyond. Who are the vendors that the community is going to be excited about and how do we bring them in and integrate them into what's going on in the building through a lobby event or food service?”

He also said programming doesn’t have to limit itself to the property in question. “It may not even have anything to do with the building. Let's go outside of the property, but let's create those stories.”

Williams’ team also offers programming packages for owners of smaller buildings that don’t require on-site tenant experience management, but that are still looking for ways to generate excitement around their properties.

No tenant experience program is complete without seamless app integration, and Williams said the right technology paired with the right level of service and support are key to generating real engagement that translates into increased tenant satisfaction.

For their Presence program, C&W partnered with Cove. This platform integrates the tenant experience with building operating systems, while also providing key performance data to help measure the impact of programming decisions.

Williams said the app is “a one-stop shop for the tenants to go in and see what's happening at the property. What's the schedule of events, how do I book conference room time, how do I book fitness training, how do I communicate with the staff of the building, what are the food options?”

The app coordinates with the property management office to automatically bill users for use of specialized facilities, measure participation at events and send out newsletters and surveys to gauge tenant satisfaction. Tenants can also use the app to coordinate with building security to manage access for both employees and visitors, effectively replacing access badges.

“It's a relatively inexpensive technology when you look at everything else that we spend money on operationally,” Williams added.

Williams said demand for custom tenant experience programs is evenly split between owners of existing buildings looking to keep up with their competitive set and new builds that want to be at the forefront of creating activated amenities for their properties.

“We're programming everything from 150,000-square-foot suburban buildings up to 1.7-million-square-foot trophy buildings in central business districts,” Williams said.

Some industrial and flex clients have even called on his team to provide programming solutions such as food trucks to maintain tenant satisfaction.

“As robust as that market has been, it's interesting that those landlords are now thinking about how to make sure that they don't let tenants walk away,” Williams said.

He also said his team is picking up some buildings from the distressed market and gave the example of an asset under the management of a special servicer. “They're saying, ‘We can't sell it right now and we don't want to go to a defaulted loan, so we're going to operate it.’ And they want to spend a bit of money to add amenities to the building.”

Whatever the case may be, Williams said elevated tenant experience programs like Presence are here to stay.

“Now that it’s there, the tenants see it, they want it and they don’t want to let go of it. And you would be going backward if you did.”