Workers across the U.S. have been flocking to cafes, restaurants, bars, gyms, airports, and hotels, but remain reticent to head back to the office. This shift has and continues to frustrate many landlords as they assess the path forward for their investments.
While every real estate asset, office and otherwise, possess specific characteristics that generate appeal, every handful of decades, a seismic shift occurs, changing the macro utilization of an asset class. Thanks to COVID, and subsequent labor markets, the office asset class is currently experiencing a seismic shift not seen since 1928 when The Milam Building in San Antonio, TX became the first air conditioned “skyscraper” forever changing the build and utilization of office space.
If the past three years have taught us anything about the future of office, it’s that workers want a different experience than what the office has delivered for the past century. Workers have found the time and money to experience cafes, restaurants, bars, gyms, and travel, but working from a traditional office is suddenly off the radar. The reason? The traditional office experience is mundane and routine.
On the contrary multi-family, hospitality, and retail have embraced experiential demand by providing extraordinary experiences. And according to McKinsey, it’s these experiences that empower us.
After surveying 1,000 individuals to assess their views on how work changed after the pandemic, McKinsey found specific recurring themes. Workers, hungry for trust, social cohesion, and purpose stated that experiences fueled them, shaping what they viewed as possible. In an additional survey of 2,000 office workers by Gensler, respondents agreed, with 83% willing to return to the office regularly if their ideal experiences were met, with a preference for hospitality-infused experiences.
While part of an employee’s experience lies internally with a company’s culture, there’s a massive external component—the experience beyond the company’s four walls.
These sought-after experiences are why demand for Class AA trophy office space far exceeds the rest of the office sector. As companies look to make the office a desirable destination instead of an obligation they are solely focused on the newest, most amenitized properties.
Class AA Trophy assets stand prepared for the “Future of Office,” though the rest of the market (90%+) needs to adapt. The trouble is that in today’s ever-changing and fiercely competitive market, office landlords find themselves at a crossroads, searching for ways to further enhance and strengthen their asset’s value in a way that both complements their offerings and amenities, and meet their customers’ unique needs.
Rising construction costs and constrained capital markets restrict capital investment optionality to adapt non-trophy assets. But Stream has another solution: to create the desired extraordinary experience with human capital instead of financial capital. For decades office buildings have tried to emulate the hospitality industry by emphasizing design, new amenities, and technology integration. This strategy has largely worked but now that employees have increased influence over their workplace, there must be an equivocal alternative to heavy capital investment.
Presenting X2 by Stream, where extraordinary experiences are the new standard.
Crafted to enliven the senses and cultivate a deeper sense of fulfillment and meaning, X2 is high-end hospitality-inspired office property management that transcends the traditional by hiring, training, placing, and rewarding our people to create demand through customer loyalty and experiences.
This hospitality-oriented approach to property management—customer centric and exceedingly customized—is meant to magnify the illustrious, with robust engagement and programming fine-tuned to build meaningful connections. Workers have communicated these demands by flocking to various other locations, it’s time for the office to follow suit.
During the X2 launch party at the stunning 1601K Street in Washington D.C., Stream’s Customer Experience Manager (CXM), Alain, greeted each customer personally, determining their core needs and desires for their workplace. The goal? To create an experience that delivers customer loyalty by proactively approaching, meeting, and exceeding occupier expectations through curated and exclusive experiences.
From proprietary tenant apps to fresh flowers, beverage offerings, live music, and events, X2’s approach—infused with genuine care and attention to our customers—ensures they receive an experience they cannot achieve elsewhere, in an asset unlike any other.
At Stream, we’re changing how people experience the workplace, one extraordinary experience and asset at a time.
Adam Showalter is Managing Director of National Office Investor Services, overseeing the strategy and advancement of the firm’s national office leasing and management portfolio. Additionally, Adam serves on Stream’s Voyager Committee and was instrumental in solidifying Stream’s prominence in Chicago’s competitive market.