EXPO REAL: European Office Investment Briefing
12:30 - 13:30
Summary Report
In the office sector ‘occupiers have taken control’
Offices are getting smaller, flexible and sustainable and they are moving to the city centre, panellists agreed at the PropertyEU European Office Investment Briefing, which was held at EXPO REAL in October.
‘We expect 20% growth in flexible offices in the next year,’ said Marc Mauscherning, director corporate solutions, JLL. ‘The key driver is the change in working patterns and people’s increased mobility. There are many freelancers moving from project to project, so the headcount might change on a monthly basis, which is a real challenge for office managers.’
Trends that are having an impact across all sectors, like smart real estate, flexispace and human experience are particularly relevant for office occupiers now. They are not passing fads but ‘give real pointers to the future’, he said.
‘It may seem a blurry concept, but the human experience drives productivity and employee engagement,’ he said. ‘The human factor is now crucial in workplaces as landlords realise they have to look after their staff and offer a good environment.’
Office buildings are an epicentre for the community as well as a workplace, with shared services, creative spaces and communal areas that are often integrated with places and amenities outside the office.
A good environment is not limited to the building but it extends to the area and the community. ‘Everyone has been surprised at how quickly and to what extent occupiers have taken control,’ said Mahdi Mokrane, head of European research and strategy, LaSalle Investment Management, ‘We now have to focus on the amenities, not just in the building but also in the surrounding area.’
The war for talent means that employees call the shots to a much greater extent than in the past, and employers must follow. ‘BMW recently moved offices to Berlin because that’s where young talent wants to be,’ said Mauscherning. ‘But the challenge for companies is not to lose the older, experienced generations in order to meet the demands of the millennials. It is necessary to strike a balance.’
Technology is an essential part of the equation but must be managed carefully. ‘There are 2 mln apps on the app store already, but how many do you actually use?’ he pointed out. ‘All office buildings already contain a lot of smart technology, the challenge is to get them all to connect and actually work to improve the place. It is important to choose those innovations that will be popular, but there is no doubt that the interaction between landlord and tenant will more high-tech going forward.’
Urbanisation is making big cities bigger and space is precious, said John Mulqueen, head of transactions and offices EMEA, CBRE Global Investors, so ‘there will be increasing pressure to use the available space in a more intensive way. Technology will play a big part in this, allowing the most efficient use of buildings.’
The attractiveness and location of a building is important but sustainability is also a must in order to meet occupiers’ demands, said Adrian Karczewicz, head of divestments CEE, Skanska Commercial Development Europe, the biggest office developer in the continent. ‘Employees’ well-being must be the priority, and that means good air, good lighting and a good environment,’ he said. ‘In our offices we are working to make energy consumption less expensive and more environmentally friendly.’
Cooperation between investors, landlords and local authorities is crucial, said James Welsh, Inward Investment Executive, Invest Aberdeen, to facilitate development with planning permits, provide good transport connections, superfast broadband and so on.
‘In Aberdeen there has been a concerted effort to drive the office market back to the city centre, improving the quality of the space, making flexible and smaller offices available,’ he said. ‘It has worked, as this year we have seen a significant growth in office occupation.’
