Looking To The Next Generation For Office Space Needs
MIAMI—Tere Blanca of Blanca Commercial Real Estate unpacks the process for professional service firms as they redesign their office spaces to align with the “workplace of the future” in this EXCLUSIVE commentary.
April 10, 2017
“Savvy firms are deploying proven methodologies to overcome the obstacles and maximize the opportunities,” writes Blanca.
MIAMI—A rapidly growing number of professional service firms are redesigning their office spaces to align with the “workplace of the future” and reap benefits including improving collaboration, client and partner service, employee recruitment and retention and technology integration. Along the way, they are recognizing that the process is far more complex than merely relocating to a trendier part of town. Savvy firms are deploying proven methodologies to overcome the obstacles and maximize the opportunities.
Professionals today are more focused on the design and location of their offices because they see the impacts on productivity, collaboration, cross selling and cohesion, as well as the ability to attract high-quality employees, particularly millennials. The office space also is an important part of the overall brand experience, as internal and external stakeholders are influenced by the look, feel, and utility of the space.
The latest studies on workplace design confirm that professional services firms are adopting innovative floor plans that incorporate plenty of natural light, open spaces that promote collaboration and innovative workspace configurations to accommodate diverse work processes and projects. They also are incorporating high-tech amenities such as high-tech conference facilities with media walls to connect employees with clients and partners across all points of the globe.
Many firms that have undertaken such redesigns have encountered challenges including internal issues building consensus, understanding their own needs and identifying the right design to support their unique business objectives. The conflicts are often more significant for larger companies in which multiple generations are represented within their leadership, resulting in differing visions for the companies and the office styles that best align to their missions.
These conflicts stem from the fact that until recently, professional service companies have embraced more traditional décor and have kept executives working behind closed doors of individual offices. However, if these companies want to compete for today’s new generation of professionals, they must adapt to their demands: more modern-looking environments with open, collaborative office layouts and the flexibility to work remotely.
Without a doubt, the professional service firms that have successfully transitioned to more modern office designs have taken their office moves more seriously than in years past. Rather than merely hiring commercial real estate advisors based on personal relationships, they are hiring them based on criteria including professional service industry experience, local market insight and a proven methodology to guide them through the process. They are working closely with these advisors to conduct thorough analyses, build internal consensus and guide progress through each stage of the process to ensure they find the dynamic office environments that support their unique needs.
In our experience working with professional-services firms, we have found it helpful to focus on a base set of criteria from the outset, including:
1. Your company’s brand identity and strategic business goals. This should be a key driver as you evaluate your options, either at your existing space or at another location. By kick-starting an internal dialogue on who you are as a company and who you want to become, you can begin to consider some key questions: What type of talent do you want to attract and retain? Are you interested in attracting a younger generation of millennials who are motivated by collaboration and flexibility? What types of clients and partners are you targeting? Do you wish to be known as a traditional, conservative company or as an innovative, forward-thinking company?
2. Your financial goals. It is critical to consider your budget, the amount you are currently spending on your space and the amount you would ideally be comfortable spending. It is important to keep in mind that an experienced commercial real estate broker can help you find the optimal space to meet your needs while significantly reducing your occupancy costs. Do not assume that bigger offices will necessarily cost more. On the contrary, by implementing an efficient workplace design, a professional service company can often reduce its footprint and maintain ample room for growth while increasing productivity. Ultimately, the key is to get the space right by working with experts who can help you find creative ways to affordably obtain your perfect office.
3. Your company culture. It is important to consider how you want your team, clients and partners to experience your office. How do you want people to feel when they arrive and leave your office? What is the first impression you want your office to convey? Do you want a high-end corporate reception area that “wows” and impresses visitors upfront, or do you want a warm, welcoming area that makes visitors feel comfortable and at home? Do you want your team members to enter your office through a brightly lit open area that facilitates interaction? How would elements like more natural light and communal areas impact your office dynamics? Within your office, do you want to foster more cross-selling between divisions and provide access to the latest technologies? Would your clients, partners and other stakeholders appreciate access to state-of- the-art conference rooms where they can conduct virtual meetings with clients and partners around the world?
4. The decision makers. The key to achieving the optimum outcome for your office space is to gain consensus early in the process and to identify an appropriate group of decision makers who will be responsible for identifying the right space for the firm. Smaller groups tend to be nimbler and more effective than boards, which often leads to too many cooks in the kitchen and navigating numerous conflicting viewpoints. In some cases, it may also make sense to work with a designated office selection committee to develop a narrow list of potential properties to present to the company’s management for consideration.
5. The advisors. Finding the right office space can be a daunting task to undertake on your own, so it is crucial to identify the right advisors. Your advisor should conduct a comprehensive assessment, complete with thorough financial analyses and forecasts to demonstrate that it fully understands your current situation, and identify viable solutions that align with your future business goals. The firm should help guide your key decision makers through a brainstorming session that will help define your company’s immediate needs as well as looking ahead five, 10 and 20 years. This analysis will ultimately help you define and establish the priorities for your office space. When you have completed these steps, it is important to address the office search in phases:
Phase One: Begin by having your leadership team establish and reach consensus on vision, space criteria, timeline, and a recommended strategy. In the first phase, you must ensure that your company gets these parameters right. Toward that end, it may be advisable to issue a request for proposals to identify an appropriate architectural firm to conduct an occupancy analysis and confirm your optimal space programmatic needs. This will help you identify which industry best practices to incorporate as you identify the best ways to design and utilize your new office space. At this stage, it is also critical to have honest internal discussions with key executives to confirm the ideal design and utilization plan for the offices.
Phase Two: Develop a scorecard that establishes a basis that informs your decision-making process and helps you make the best selections. This scorecard should consider an array of key factors including geographic location, parking, on-site amenities, tenant services, walkability, and access to public transit.
At this stage, you should begin to engage the market with your established office requirements. Developing a short list of contenders and touring your top choices will give you greater leverage for your future tenancy as the current landlords and owners of prospective new locations begin recognizing your name and your interest. It also will ensure that your firm is well-positioned to secure the most favorable outcomes and seize immediate opportunities as they present themselves.
Phase 3: When the team has reached consensus on the top two or three options, your commercial real estate advisor should negotiate terms based on the criteria and benchmarks established in phases one and two. Then, your advisor should help you complete a lease or renewal amendment, and remain engaged with you throughout the process, from preliminary renovations to ultimately moving into the new space. Indeed, transitioning to “the workplace of the future” is an exciting moment that can be positively transformative for professional service companies. To ensure your business capitalizes on this important shift, it is critical to follow proven best practices and methodologies to ensure the best-possible results. Professional service firms that do this can gain a significant competitive advantage and better position themselves for continued success.