For years, commercial real estate owners have been hard-pressed to meet tenants’ demands in their continued efforts to keep their vacancy numbers low. The task became even more challenging at the onset of the COVID-19 pandemic when mandates forced many businesses into a fully remote work model.
Now, even as buildings have opened back up, CRE owners are searching for strategies to get tenants to come back as remote and hybrid work models have become the rule rather than the exception.
A strategy they might want to consider is ensuring their buildings have outstanding air quality, according to Joanna Frank, president and CEO of the Center for Active Design, which operates Fitwel, a certification system committed to building health. Employees have demanded healthy offices before the pandemic hit, so if they’re going to return now, they need assurances they’re stepping into an environment with good air.
“We were seeing high percentages, especially of the younger workforce, rating the quality of their workplace as one of the key decision makers about whether they chose to go to a job in the first place and whether they stayed there,” Frank told Connected Real Estate Magazine. “COVID only accelerated that trend and I feel like I know we all became much bigger experts in understanding the effect air quality has on both our physical and mental health.”
Reliable in-building wireless connectivity transformed from a “nice to have” to a “must have” in CRE buildings in recent years. Good in-building air quality has also followed this shift.
“Pre-COVID, having a healthy workplace was kind of icing on the cake,” Frank said. “Now, it’s seen as a risk if you don’t have indoor air quality because tenants will choose buildings that can substantiate the quality of air within the buildings, or employees will demand that you can substantiate what the air quality is in your buildings.”
Making adjustments to improve indoor air quality might seem like a big expense, but Fitwel’s research shows that changes can be made affordably, regardless of asset class, according to Frank. Operational strategies are shown to have the biggest impact on tenant satisfaction, something that’s accessible to all buildings.
“All buildings can adopt a high-quality maintenance plan, cleaning protocols or an integrated pest management policy,” she said. “There’s a lot that everyone can do, regardless of whether it’s an existing building or which asset class it’s in.”
Quality air is critical to one’s physical health but also their mental health, another selling point CRE owners and employers should consider, Frank said. From a productivity standpoint, air quality can impact a person’s ability to concentrate. There’s also the isolation factor — people were socially isolated during the past three years and getting back to an office setting could help remedy that even if employees aren’t physically in the office every day.
“Coming together as a group of people is incredibly beneficial for your mental health as well as productivity,” Frank said. “We’re social creatures, it’s detrimental for our health to be isolated — it’s directly associated with a shorter life expectancy. If I’m an employer, we go out of our way to bring our team together because we know that it’s really important.
“Nobody is required to come into the office on a daily basis, but we do want to ensure that people have those interpersonal bonds with one another within a workplace because that’s also foundational for trust. That interpersonal interaction is essential for our overall wellness.”
Improving air quality is a great first step for CRE owners to take to raise their occupancy levels, However, getting tenants back will ultimately come down to their ability to demonstrate why operating out of their building is better than working out of their home office, Frank said. That effort begins with providing their tenants with the necessary information that will encourage them to come back to their physical office.
“Successful buildings have always met the demands of the day, whatever they are,” Frank said. “We’ve seen a once-in-a-generation shift where buildings now need to be health promoting because we’ve all been laser focused on health for the last three years. But there are so many things that buildings can do to promote the health of their occupants. Buildings measurably and substantially impact the health of the occupants and the surrounding community, whether you know it or not. They always have. They always will.”
CRE owners who recognize that the focus has shifted from the physical building to the tenants are the most likely to succeed in this new environment, according to Frank.
“Real estate is no longer just thinking about physical assets,” she said. “You have to be considering what are the priorities of the people within those assets because it is their demand you need to meet, in order to maintain your occupancy, in order to be able to lease up your buildings faster, attract tenants, and differentiate yourselves in the marketplace.”