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Do tenants really have the upper hand?

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Washington DC’s Bisnow Summit reveals what “the office of tomorrow” will look like

 

From New York to New Mexico, coworking and flexible-office space is on the rise all over the US as businesses and employees alike have discovered the benefits that flexible working trends can bring. Across the country, brand-new buildings are springing up and others are undergoing retrofits to satisfy the market. But what does this mean for the landlords and tenants of those buildings – and for the future of work in general? With supply outstripping demand, does it mean that tenants are now calling all the shots?

Not exactly, according to Jeff Doughman, Executive Vice President at IWG. Speaking at Washington’s Bisnow Greater DC State of the Office Summit on 10th September, he told the audience that what it comes down to is flexibility. “While the feeling may be that the tenants do have the upper hand, the reality is landlords are not changing the way they do business,” he said. “Actually, tenants just want even more flexibility when they perceive the market to be in their favor.”

Like other cities across the States, Washington has enjoyed a boom in commercial real-estate in recent years, and played an active role in the flexspace revolution. Coworking, tenant demands and how “the office of tomorrow” will manifest in the US capital (and further afield) were some of the topics up for discussion, as well as the growing demand for tenant amenities like business lounges.

According to Doughman, “The general consensus is that one of the biggest trends taking hold right now is the ability for providers to enable their clients to conduct their business wherever and whenever they like.” As the “always-on” culture takes hold of more aspects of our lives, it’s not just remote working that’s important. The process of actually renting the space is expected to be an on-demand process too: “They want to make same-day buying decisions for their workspaces and then they want to secure and use the product while on the go,” adds Doughman.

With the Fourth Industrial Revolution underway, clients have come to expect infrastructure that takes full advantage of cloud-computing and file-sharing software: “They’re also looking to interact with their workspace provider with increased technology,” he says. And it doesn’t stop there. Design and even lease terms are on the agenda too, according to Doughman. “Our clients are asking for flexibility in their term agreements and design, and specifically asking for a say in the layout and the office furniture,” he reveals.

In keeping with our incerasingly malleable lives, what clients want across the board is more choice – and greater flexibility. From a well-upholstered lounge in a coworking space to a quiet corner for getting emails sent and reports filed, everything – including cafés, gyms and even wellness rooms – is on the table as potential sweeteners for a deal. Like Doughman says, “It’s important to have a multiplatform strategy to ensure the creation of a space that best suits a variety of tenant amenities… to create a space that is much more than just an office.”

 

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