by Kevin Annis, SIOR, CCIM, Broker/Principal with Archcrest Commercial Partners
While some companies are allowing a permanent work from home option, most employers are recognizing the benefits of in office collaboration and training and are pushing to get their employees back into the physical office space. Thus, as businesses across the country are returning to work nearly one year from the initial stay at home order, they are carefully considering different factors of the space they are returning to. They are having to evaluate full time vs. part time, “in office” work vs. working from home, space for distancing, and other features to make the environment safe for employees and clients.
As we came out of the “Great Recession” in 2012 there was a trend for companies’ “flight to quality” due to the fact that Class A office space rents had fallen so much that there was only a small lease rate margin between A and B properties. Now, as we come out of the COVID pandemic, the trends are leaning more towards a “flight to safety.”
Some office building owners are proactively offering initiatives for companies to return to space more safely — and therefore more quickly — than others. Basin Street Properties, for example, has created the C.A.R.E.S. initiative to facility protocols for the heath and well-being of its tenants and employees. C.A.R.E.S. stands for Clean Hands, Air Systems, Restroom Etiquette, Elevator Protocol, and Safe Distance.
However, despite the best efforts of multi-tenant office buildings, it is the garden style office buildings that are proving popular with tenants seeking space that allows for social distancing options during the coronavirus era. These key features include private entrances, lobbies and amenities that don’t have to be shared with other businesses. I have seen personally seen numerous examples of this trend.
Examples of garden style office building designs. On the left is a building in the Longley Professional Campus and the right are spaces in the Sierra Vista Office Campus.
Most clients I speak with are over working from home. They want to go back to their office, it’s just a matter of how and when they can do it safely. It is this new return to work dynamic that has created a large demand for ArchCrest Commercial Partners’ garden office style complexes in South Reno.
One of the main draws of these developments in the COVID-19 era is that they offer a private entrance directly from the parking lot so there is limited exposure. In addition, the large parking lots and landscaped areas give the tenant’s employees space to go on walks, eat outdoors and get fresh air.
Nice outdoor spaces give employees opportunities to safely walk on their breaks.
This is obvious with the recent demand we have received in our new medical development at Reno Medical Campus (RMC) at Longley and Double R Blvd. RMC development lends itself well to any tenant that is trying to go back to their office safely post COVID. Many tenants, especially medical tenants in the COVID era, do not want to go back to a larger building where they are sharing elevators or common spaces with multiple other tenants. Garden office developments provide buyers and tenants with an extra level of comfort as it minimizes interference with other tenants.
The desire for more private office spaces goes hand-in-hand with the desire for tenants to distance themselves from large, crowded high-rise buildings.
This is why they majority of the clients we are currently working with are rethinking their office strategy right now. For example, we have companies returning to work and with shared spaces and distancing requirements, they aren’t sure if they need to occupy 10,000 square feet or 3,000 square feet. Some are even considering leasing several smaller suites throughout town as opposed to one large central location to separate employees and reduce risk. Companies that have historically always been located in large multi-tenant office buildings are now interested in more standalone opportunities with indoor/outdoor space, single tenant HVAC systems, private entrances and operable windows. Garden office developments like Reno Medical Campus trends to the new wave of COVID-conscious tenants.
While we are hopeful that with vaccinations the Covid-19 pandemic is in our rear-view mirror, there is no doubt there will be long term effects on the office market. The question will be how monumental the shift to remote workforce and standalone office space demand will be and is definitely something to keep an eye on.
Outdoor sitting areas give employees safe sitting and meeting spaces
Kevin Annis, SIOR, CCIM is Broker/Principal with ArchCrest Commercial partners, a powerhouse commercial brokerage in Northern Nevada. Alongside Tanamera Development, they have positioned themselves as leaders and experts in the garden office market in Northern Nevada. For more information on the Reno Medical Campus or the Northern Nevada office market, contact Kevin at firstname.lastname@example.org or 775-742-2539. NV Lic B.1000617