Working in an office building is a familiar experience for millions of people. Aside from degree to which your office space uses design to improve your work day, the common spaces of the building probably provide minimal support at best. They are typically characterized by the sterility of their ground floor lobbies, the grandeur (or lack thereof) of their elevator cabs, and some minimal mix of uses, if any, at the street level. In short, the typical office building does little to support today's highly competitive world of work, but driven by the changing expectations of workers and subsequently the demands of their potential employers, office buildings will need to undergo a paradigm shift to remain attractive, competitive and marketable to today's top tier companies.
Talent scarcity and the shift toward employee influence
There's a common recognition in developed economies that the age of focusing on productivity alone has passed us. What began as an Industrial Revolution-driven focus on orderly work quantifiable by production quotas gave rise to the last century's - and still today's - mainstream office building model. Architecturally, it's one of perhaps the simplest typologies of buildings - public space near the ground floor, usually spartan and focused on controlling access to tenant floors and a warm shell of expansive, repetitive, open floor plates. Sort of like the type of space needed for an assembly line turned vertical. From an ownership and development standpoint, the simplicity of the office building makes the calculus around capital investment easier and the major factor in that math is efficiency.
Today, the world of work looks different. There are many reasons: generational shifts, urbanization, technology and mobility...the list of factors goes on, but amid them, one particular phenomenon is emerging as an outgrowth that is significantly impacting the environments we work within. Today's business world is experiencing very low unemployment and a very high degree of talent scarcity. According to ManpowerGroup's 2016/2017 Talent Shortage Survey, 46% of U.S. employers are having difficulty filling jobs, globally the statistic is 40% (2016/2017 US Talent Shortage Survey, ManpowerGroup). The number of high-growth sectors with a need for talented, creative problem solvers continues to grow, meaning companies are prioritizing recruitment and retention.
Furthermore, established companies now compete with high-growth emerging businesses for the same talent leading organizations to think creatively about the place people come to work. Our recent work in Boulder with Google - known for their workplace innovation - revealed that constant evolution is required to keep the office space as a powerful attractor of top employees. The Google Boulder campus was a progression of Google's hallmark of food and fun in offices to include a significant focus on occupant health with biophilic design, a bike and ski shop, and fitness and meditation amenities. No longer are employees interested in latching onto a corporation simply because of its reputation, instead, they are looking to integrate work with their life, find enrichment in what they do and work in a way that is effective and not simply productive.
This gets us back to the office building. Its architectural efficiency and proforma clarity is maybe a harbinger of the approach to predictable corporate culture they are built to house. This is no longer competitive. The office building evolved to serve the capital investors enabling their construction, tenants existed in long-term leases to provide the stable income with minimal hands-on care and feeding and employees weren't even a consideration - that was the tenant's problem.
Today, however, those tenants are moving because they need to attract and retain employees and keep them creative and innovative. If they are going to spend the money to relocate their company, the character and features of the space their moving to matter much more than before. In a sense, due to the talent scarcity, the employee, has now leapfrogged into the position of being the most important entity behind the success of an office building. Lisa Picard, CEO of Office Equity, refers to this as the B2B nature of office real estate becoming a B2C model where 'C', the customer, are the people inhabiting the building on a daily basis. As a result, the faceless office building must now respond to the very human needs of the actual people going to work in it. It's no longer a vertical productivity farm, it is a community of high-performing professionals, it is a work-Place.
Warm bodies aren't enough and neither is a basic core and shell
Leading organizations throughout the economy are emphasizing collaboration, mobility and variety in their work settings. Workplace research supports this notion of being able to work in an activity-based fashion where there is appropriate space for individual work, group collaboration, and serendipitous interaction. But if space is being used as a recruitment differentiator for an organization this probably won't simply mean cubicles, conference rooms and a common water cooler.
The competitive nature of the work world has raised employee expectations to include benefits like mobility for heads-down work (i.e. working at a coffee shop); conference spaces that include high-touch a/v and variety in room size and function; and significant emphasis on the social benefit of food and beverage to encouraging interaction. Further, employees increasingly look for variety in their day and options in their commute in the form of fitness spaces, bike storage and concierge services. Taken together, these expectations far exceed a sustainable tenant improvement budget, so for office building owners to competitively attract these types of tenants, they must begin to think of how to shoulder some of these amenities. As Lisa Picard puts it, office buildings will need to start to treat occupants like hotels treat guests.
To do so, building owners will need to get more creative about how amenities are provided and serviced and this will have an impact on the structure of tenant leases. There will also be a cascading effect on capital markets investors as the shift in office buildings leads to a more complex ecosystem of uses. However, if an office building presents common amenities that 1.) attract tenants and 2.) create a symbiotic relationship between tenant needs and office building infrastructure, it potentially creates a mutually beneficial advancement of the building type. Building owners get better and more committed tenants and have more tools to keep tenants happy and tenants can leverage the spaces beyond their office suite to the benefit of recruitment and retention.
We can already see this playing out in the public sector where government entities who are often long-term occupants of publicly funded facilities are dealing with the same talent scarcity and fierce competition with private industry. Facilities we've recently designed for Fort Collins Ultilities in Fort Collins, Colorado and for the Colorado Department of Transportation (CDOT) both emphasized the need to attract the next generation of talent to their organizations and each project emphasized the need for supporting employee culture and work styles as long-term strategies to achieve this.
Fort Collins UAB
In Fort Collins at the Utilities Administration Building, the facility emphasizes the organization's culture of sustainability through it's LEED v4 Platinum design focused around occupant comfort using daylight and a high performance envelope. It also introduces a variety of size and styles of meeting spaces to support flexible working and the project incorporated a small, previously vacant historic structure on site as a food and beverage amenity operated by a private local coffee shop.
in Denver was located specifically in a site adjacent to multiple alternative transit options - bus, lightrail, and bike paths. Supporting and building team culture across the organization is facilitated through social hub spaces designed on each floor of the building and wellness programs are supported by an on-site fitness facility. Outside the building a sculpted landscape plaza features outdoor spaces for work or retreat as well as space for food trucks or large group gatherings.
Amenitizing the City
If we see this trend of office buildings becoming spaces that directly support their occupants through improved common amenities and infrastructure the potential exists for a greater sense of community and information sharing to occur within and among office building tenants. It also presents the exciting possibility of an increased mix of uses within these building types that can have a much broader impact on the urban life of the city around them. Currently, in Denver where I live, there are several swaths of our central business district that are starved of street-level activity - particularly outside of business hours, but even during them. As downtowns strive to become 24-hour communities, diversity of uses is a critical factor. An office building that only houses people from 8-5 and meets the street with an empty lobby isn't participating in the surrounding urban life actively despite it's potentially central location. On the other hand, a work-place that supports its tenants with vibrant common uses like food and beverage, health and well-being, or common conference spaces could introduce new hubs of activities and potential urban life improvements as well. This seems to be a win-win on many levels and should be part of the conversation for any new or soon to be revitalized office property.