Building  Owners  and  Managers  Association  International

Building Owners and Managers Association International

Thought Leaders Examine Work Space and Workforce Dynamics in 2025

The best and brightest minds in commercial real estate gathered at Georgetown University in Washington, D.C. on November 10 to discuss what the industry will look like in 2025. The program, 2025: A Vision for Commercial Real Estate presented by the BOMA Foundation and the Georgetown University School of Continuing Studies and its Masters of Professional Studies in Real Estate Program, brought together experts from academia and industry to debate how factors like technology, globalization, climate change and demographic shifts will affect the workplace and the workforce over the next several years.

“If the last 15 years are any indication of the pace of change in our industry, the next 15 will be phenomenal,” said BOMA Foundation Chair Marilyn Wilbarger, director of property management, City of Key West, Fla., in her opening remarks. “Our thought leaders are going to give us a lot to think about in terms of how we should strategize to ensure that our future buildings are places where people want to work.

Industry Overview
Katya Naman, CCIM, senior vice president, Lowe Enterprises, Inc. and BOMA International Chair Boyd Zoccola, executive vice president, Hokanson Companies Inc., presented an outlook on what the next five years hold for commercial real estate. One of the biggest trends they identified is increasing density in office buildings. Naman noted that the U.S. General Services Administration (GSA) is currently undergoing a renovation to double density at its headquarters in Washington, D.C. Zoccola cited a deal recently closed in New York City that reduced the square foot per worker by one third.

Naman also pointed out that companies are looking for holistic environments for their employees—meaning proximity to public transport, retail and housing. “Employees want to be close to the subway or bus stop, they want to be able to do their errands on their lunch break,” she said. As a result, transit-oriented mixed-use development will be increasingly important.

Zoccola touched on the need for more compelling sustainability incentives to make work spaces more green. “Owners are willing to spend money to make buildings more efficient, but we need stronger incentives to do so,” he said, adding that the recent green retrofit at the Empire State Building, which could reduce the building’s energy consumption by almost 40 percent, was not eligible for any government incentives.

The Workspace
Naman moderated a diverse panel featuring speakers from government, architecture and corporate real estate advisory firms, who discussed workspace trends and the potential demand for office space in 2025. Mobility was at the heart of the discussion, with all panelists agreeing that teleworking will continue to gain momentum. While technology is certainly driving the trend, Joan Blumenfeld, principal, Perkins & Will, noted that Gen-Xers and Millenials are more comfortable blending work and home life than baby boomers. Teleworking also aligns with many companies’ corporate social responsibility mandates as it cuts down the carbon footprint of employee commutes and building occupancy.

Martha A. O’Mara, PhD, CRE, managing director, Corporate Portfolio Analytics, stated that because teleworking offers employees so many benefits, companies will have to provide “magnets”—or incentives—to lure workers into the office. Companies that value creativity and collaboration, like Google, Apple and Zappos, she said, offer employees everything from game rooms to company-sponsored transportation to incentivize their staff to work in the office.

Several panelists remarked that as mobile work arrangements increase, face-to-face meetings will take on a greater importance. They cited the rise of companies that offer “liquid space,” space leased by the hour that companies rent to conduct meetings.

As teleworking gains momentum, many companies will need less space per worker. GSA’s Chief Asset Officer Gavin Bloch spoke about the agency’s mandate to increase teleworking among employees and dramatically increase density in their buildings. “As an industry, we’re going to see huge changes in the amount of space per worker in the future,” he remarked, adding that a typical GSA building uses 22 percent less energy than a comparable private-sector tenant.

James B. King, AIA, LEED, AP, principal, AREA Advisor LLC, discussed a recent thesis project on the impact of teleworking on demand for office space written by a student in Georgetown’s real estate program. “The thesis concludes that there will be no need to develop new buildings to accommodate workers in the future—the space already in existence will need to be reconfigured to fit future needs,” he explained.

The key to future success in commercial real estate, the panelists agreed, is innovation. Blumenfeld and her team are increasingly designing for a company’s global space needs, which she credits to innovative thinking. “The U.S. is still at the forefront of workspace design and it's still what global companies are looking for, despite cultural differences,” she said.  Property management firms will also have to think carefully about how they can provide the spaces and services that future tenants will need. Commented O’Mara: “I don't think we need new space, we need to reconfigure it. To compete, landlords are going to have to think about what they do besides offer plain vanilla office space.”

The Workforce
BOMA President Henry Chamberlain moderated a panel that looked at the Workforce in 2025. Chamberlain kicked off the discussion by noting that as productivity within companies continues to increase, developing and retaining a talented workforce is a core priority and challenge for commercial real estate firms. Panelists discussed how the goals and priorities of an emerging workforce are helping firms evolve to meet new expectations.

 “Technology is critical and archaic systems will be a deterrent to candidates,” said Matthew A. Metro, principal, The Maison Group Inc., who also noted that social media is helping companies brand and sell, and that those companies should  empower employees to use new technologies and media to market their companies and attract the best talent.

Panelists also discussed how the concept of career development is changing with the incoming workforce. “The corporate ladder concept is starting to go away,” suggested Kristen Reese, director of talent acquisition, Bozzuto Group. “Satisfying careers don’t necessarily have to go up, but tend to go more in waves of different experiences.”

Reese also explained that the hierarchy trickle down of information is being replaced by more collaborative experiences. Panelists agreed that innovation through collaboration will take on added importance. Freddie Lewis Archer, principal, Lewis Real Estate Services, pointed out the importance of not generalizing the talents of different generations. “Baby boomers will need to be more tech savvy and  newbies will need educate themselves and learn from seasoned professionals,” said Lewis, who also noted that the marketplace will continue to become more diverse and that the workforce will soon be comprised of five generations.

Panelist Mike Bush, principal, TMR – The Minority Resource, stressed that the despite changes in the way we work, old skills will still be  important. “You will have to be able to do the numbers and you will have to be able to communicate,” said Bush. “And you will have to stay in touch with the real world by putting feet on the street and not sitting behind a desk. You will still have to work hard and you should have the certifications that pertain to your field.”

But what is ultimately going to attract and retain the best talent? Reese noted that it may come down to something very basic, “If someone is looking for a job, they are going to want to know if people are happy working there.”

In his closing remarks, Chuck Schilke, associate dean of Georgetown University’s Master’s Program in Real Estate, touched on the ways in which the workforce of 2025 will affect commercial real estate: “A five-generation real estate workforce will collaborate in the workspace of the future.  This promises to give the future real estate workforce a long-term perspective that will foster more sustainable and energy-efficient buildings.”