Pricing is only the 7th most important factor when leasing office space today…
Check out our hierarchy of what we’ve found really matters for today’s discernible tenants.
01 Location, Location
This matters now more than ever before. In a hybrid world – how close you are to public transport, and what public transport governs who can come to your workspace. Additionally local amenity (coffee shops, gyms, green spaces) matter to workers. It all adds to their ‘in work’ experience.
02 Curb appeal
We eat with our eyes. For the decision makers, their HQ is a reflection of their brand, vision, culture, aspiration and status. That hasn’t changed (yet). In many cases, it’s also the most tangible physical asset in their business. It’s also the first impression a potential recruit or client will have.
Businesses require high grade communications infrastructure (fibre backbones). Easy access to power and structured networks. Post-pandemic they want air conditioning and in most cases mechanical ventilation. Security and access control are paramount in an era where information is for many their most valuable asset.
This has been moving up the hierarchy steadily for some years now. It’s up here because if the building doesn’t tick the box, then for more and more businesses, the rest of the list is irrelevant – on to the next one.
This is often overstated – but it is of major importance in today’s world. High quality showers, bike storage, lockers are a must. Communal areas, free coffee, shareable meeting rooms are a plus – but not essential.
06 Leasing structure
It used to be one structure with some variety. No longer. Those that offer optionality have the greatest chance of staying in the race. Think more flex, but also package. CAT A +, managed space, or a hybrid of the two. In many cases, businesses are taking incentives in the form of furnishings such as smart phone booths and collaboration tables.
You only get down to here if everything above stacks. Even then, you’ll find businesses (like normal people) will make the stretch for something that ticks all the boxes. Interestingly though, if there’s a compromise, rather than paying less you tend to find that they will discount the product all together and move on to the next asset.
Think Like Your Customer
This decision hierarchy is how TSP forms a product market fit for our asset strategies.
You have to think like your customer, understand their red lines, their needs and wants, and where they have flexibility.
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