By Mohit Batra, Regional Director: COVID-19, unlike previous economic downturns, is having an immediate and pervasive effect on the commercial real estate market around the world.
The world has changed! And so has the new work environment.
The COVID-19 pandemic’s human and economic consequences are now being felt around the world. The pandemic’s exponential expansion and multinational efforts to contain it are having an unparalleled effect on how we work and do business. Developers, Property Owners, Brokers, and Investors have also been affected by the changing economic condition.
COVID-19 has stood out among epidemics, pandemics, and economic downturns over the last century because of its global response and scope. The entire country has been put on lockdown or has been given rescue orders. This sudden shift in how we work has necessitated widespread remote work, a total lifestyle transition, and a reasonable amount of anxiety. These convergent forces, which may last for an extended period of time, will undoubtedly continue to affect occupiers and end-users of real estate in unforeseen and unusual ways, with ramifications for the commercial real estate industry.
The amenities managed by property management firms have changed as the market has changed. Although some common areas and services are in high demand due to social distancing and other constraints, others are much less so. Certain facilities have become more prominent, and even essential, for getting through the day-to-day as a result of the seismic change in nearly every part of our lives.
Commercial real estate amenities are one of the four foundations of performance for any commercial project, along with location, building efficiency, and pricing. This is valid around the line across the business.
The industry demand can be fierce, and if you want to draw smart renters, you must look past low rentals and attractive lease terms. Today’s commercial property management requires you to provide prospects with services that they value and are willing to pay for. Such facilities improve tenants’ day-to-day living environment and, in some cases, provide considerable time and money savings. If your property is in a good location, you will increase your odds of leasing it to conscientious tenants by offering valuable facilities.
Today’s tenants expect value for money. They are looking for convenience, ambiance, comfort, and security. They favor projects that have health and wellbeing amenities as well as sophisticated security features. Many more proven developers have been able to achieve a balanced mix with each of these features in their designs and deliveries.
Much as retail has evolved to meet the needs of a new customer, other forms of commercial real estate would need to change to meet the needs of the new tenant base. Along with multifamily, commercial and retail buildings are expanding their amenity offerings to provide an atmosphere and lifestyle for the businesses they want to attract.
Developers believe that thoughtful amenity packages boost the velocity of tenant attraction and aid in tenant retention. Modern amenities usually provide tenants with a kind of one-of-a-kind experience that contributes to their business strategy.
One such amenity that is most preferred today is health and safety. Safety is now the highest priority for both Developers and tenants. If anyone does not feel comfortable in your building, they may be unable to reflect on their tasks at hand. In the case of an emergency, tenants must have immediate access to assistance for the resolution of their problems.
Next comes offering flexible working hours of building operation. The days of going from 9 a.m. to 5 p.m. and weekends off are long gone in these COVID times. Commercial property management experts who have access to land, buildings, and utilities to satisfy the demands of their clients may have an advantage over those that want to save money by turning off the electricity on weekends and other days that are usually called “off hours.” What you may not realize is that you can directly negotiate with utility providers to offer you power supply at prices that better fit your clients’ working hours. This allows you to give your renters the advantage of sticking to their timetable and potentially saving money.
With the entire corporate world gradually realizing the significance of our environmental footprint as well as the costs associated with it, it’s no surprise that one of the top features that many tenants want is evidence of energy-efficient initiatives. Some of the ways are by using Solar panels or use of AI in modern buildings for managing these facilities. The use of solar panels in a commercial building has been made mandatory by the government. Solar panels are an obvious option for commercial buildings, as rooftop solar power will meet up to 20% of an office building’s electricity needs in India. A building with a built-in renewable energy supply would become more desirable and attractive to the tenant. These methods can save money and is supportive of the environment.
By offering few such amenities we can attract potential tenants, thereby increasing the importance of rental properties. These are some of the common commercial real estate amenities that can potentially generate income for astute commercial property owners. Choose your facilities depending on your budget, venue, or any particular business type for which you are leasing out office space. The bottom line is that Developers & property owners work in a tenant’s market and must take constructive measures to avoid vacant spaces and mounting costs. This will also bring the right kind of balance required in demand & supply of A-Grade commercial space wherein all the parties involved will enjoy long-term benefits.