Commercial Investment Real Estate is the magazine of the CCIM Institute, the leading provider of commercial real estate education. CIRE covers market trends, current developments, and business strategies within the commercial real estate field.
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COMMERCIAL INVESTMENT REAL ESTATE 36 November | December 2017 Evaluation Criteria: Comparison of Building A and Building B • Does building A or B have the infrastructure to support working outside of the physical office? • Does building A or B help to engage employ- ees? For example, does it offer wellness facilities, classes, and robust Wi-Fi? • Does the neighborhood have a good vibe? What's the walk score? • Does building A or B offer long-, medium-, and short-term flexible space options that align with the organization's needs? • Does the tech and internet infrastructure in building A or B support the organization's needs today and during next three years? • Does building A or B support the firm's culture and brand? These are high stakes questions for a potential tenant. Measuring the quality of the user experience of a building for clients, backed by solid data, is a skill set that brokers need to acquire. Embracing Tenants' Experiences Speaking of data, engagement data about space usage will be another critical factor for modern ten- ants as they determine how to optimize their work- place to meet the needs of their people. Can a landlord provide the businesses leasing space with information about, for example, how often the boardroom on the 12th floor is being used? Or the percentage of desks occupied at any one time? Brokers who understand this crucial information will help tenants drive more value out from their spaces, while transforming how they conduct busi- ness within commercial real estate. Finally, in the user experience-driven world, bro- kers will need to rethink the way they tour spaces and gather feedback about the property. Formerly, the broker conducted a typical tour by showing the tenant's top executives their corner offices and then calling it a day. Today, however, leasing agents need to focus their tours on how their space will make every single member of the leasing tenant's team happier and more productive. And that old 20-page tour bro- chure won't cut it anymore either. Consider using simple online surveys to gather employee space pain points and feedback prior to the search. Brokers also can leverage virtual tours to quick ly scale the number of people (and decision-makers) who are able to experi- ence the space without actually having to be there physically. Integrating Changes To give landlords the best possible advice, brokers need to become experts on the modern organiza- tion. After all, if brokers don't understand how companies operate and are actually using space, they are not going to be useful advisers to land- lords. They may even lose deals. This approach means recognizing the new trends and understanding what today's tenants need. Then, the most valuable thing brokers can do is to educate their landlord clients about these shifts and give them practical, actionable advice to help them suc- cessfully pivot toward a user-experience mindset. To get started, brokers should consider the following: • Find the latest resources on the topic, such as blogs, research reports, case studies, and tweets by experts in the field, and share them with the landlord clients. Get the landlords thinking about the matrix above. Discuss how their properties benchmark on each factor against a competitor's set. If they compare poorly, brokers should share their thoughts for improvements. • Set up a couple of tenant discovery sessions for the landlords where they can sit down with a modern tenant outside of the deal process and discuss their top concerns and needs. • Being comfortable with data also is particularly important for brokers. They often will be working directly with tenant representatives to get their clients into their spaces. These potential tenants are making data-driven site-selection decisions and have more information accessible than ever before. They will expect land- lords and the landlords' representatives to be ready to answer any of their questions as they come up, with responses backed up with the appropriate data. Brokers will be able to make deals happen much more quickly if they can answer in kind. These changes may feel unsettling to brokers. However, they're actually a huge opportunity. If brokers can master this new landscape and adapt to the expectations of modern tenants, they can dif- ferentiate themselves from the traditional brokers. The result will be to set these brokers apart, provid- ing them with long, successful careers. All it takes is a willingness to learn and a shift in mindset. Brandon Weber is co-founder and chief product officer at VTS in New York City. Contact him at brandon.weber@vts.com.