Commercial Investment Real Estate May/June 2017 - Page 19
Whether new build or renovation, aesthetically successful
ofﬁ ce developments provide a collaborative, industrial vibe.
Ceilings are up to 14 feet high, windows maximize natu-
ral light, and large tables place workers in closer proximity
to boost collaboration. Signif icantly denser, employee
spaces range from 125 to 150 sf compared to 300 sf during
But what modern ofﬁ ces lack in dedicated space, they make up
for with collaborative areas. In-house cafés and breakout rooms
with comfortable seating and recreational distractions are geared
toward the new work culture dynamic.
The phenomenon of telecommuting is essential to the long-
term trends affecting ofﬁ ce space. Estimates suggest only 70 to
75 percent of a company’s workforce is in a physical ofﬁ ce on
any given workday, which contributes to needing less physical
ofﬁ ce space.
Virtual Ofﬁ ces
Widespread connectivity, cloud computing, and digital services
supporting a virtual ofﬁ ce have enabled workers the ﬂ exibility
to reinvent how and where work is done. GoToMeeting and
Skype allow colleagues to chat “face-to-face” from different
Providers of rentable ofﬁ ce, meeting, and collaboration spaces
such as WeWork and Regus further enlarge the deﬁ nition of
work and workspace. Collaboration platforms such as Micro-
soft’s SharePoint and Slack allow for virtual collaboration within
an enterprise and promote the technological trend of dynamic,
What does that mean for investors? Gateway and smaller mar-
kets attracting a highly educated, highly skilled workforce will
continue to thrive. Urban ofﬁ ce properties will continue to be in
demand, as well as those served by mass transit or located near
urban housing and amenities.
Open ﬂ oor plans and industrial aesthetics will continue to
replace the drop-ceiling spaces and cubicles of the 1990s. Cities
that are not immediate markets for the highly educated, newly
graduated workforce may suffer, though certain inﬁ ll Sunbelt
locations are capitalizing on steady demand and reasonable pric-
ing. On the other hand, commodity suburban properties not
accessible by mass transit or with outmoded, difﬁ cult-to-renovate
interiors are rapidly becoming obsolete.
Scott Crowe is chief investment strategist at CenterSquare
Investment Management in Plymouth Meeting, Pa. Contact him at
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May | June 2017