As the world continues to shift and the hybrid work area becomes the new normal, commercial property teams need to compete in new ways. Today, the focus has shifted to competing on the tenant experience to find and retain the best tenants for commercial properties.
Top 3 Challenges to Finding the Best Tenants
- You’re uncertain about the value of amenities. You see other CRE companies investing big in amenities, but you’re not completely sure that’s money well spent to find the best commercial tenants. Especially as you remain uncertain whether the industry will ever see a true return to the office. And you don’t want to make the wrong investments.
- You’re unsure how to attract and retain quality tenants. What tenants want and need is shifting, but is your team adapting quickly enough? You’re not completely sure because you don’t have the data that answers the question. Or maybe you’re not completely connected to your tenants to know with 100% certainty.
- You’re having trouble building your brand’s awareness and tenant loyalty. You know tenant loyalty is key to driving higher occupancy and higher rents, but you’re not sure the exact steps to take to build up your brand.
Focusing on overcoming the above three challenges will help you find and retain the best tenants for commercial properties. Read on for tips on where to concentrate your efforts.
Focus Area #1: ROI on Amenities
Almost 60% of workers in the U.S. now work from home at least some of the time, according to research from McKinsey. Another of the survey’s revelations? When people have the chance to work flexibly, 87% of them take it. It would be accurate to say that work and flexibility now go hand in hand.
But that causes some pain points for the CRE industry.
The thing is, companies (your tenants) want people back in the office. To woo employees back, your tenants need to provide a workplace their employees want to come to every day. That means they’re looking to CRE owners and operators as partners to meet those goals. Simply put, the building must provide a better experience to woo workers away from the comforts of home.
That’s where amenities come in.
Many CRE companies are spending millions on adding amenities to their properties – from new art installations to tenant lounges and wellness centers, cafes, and more. But when it comes to amenities, one size doesn’t fit all.
Each property is unique, as are their amenity needs. So how do you determine where your investment will pay off in finding the best tenants? Data extracted from tenant usage of a tenant experience app is the key. It comes down to access to real-time data on tenant preferences and behaviors.
For example, service and amenity utilization data can tell you which amenities are or aren’t being used. With these insights in hand, you can focus your investment on the amenities being used and save money on the ones that aren’t. With continuous communication strategy and pulse surveys, you can analyze responses to determine which amenities and spaces could be worth investing in to boost tenant satisfaction and retention.
Focus Area #2: Attracting & Retaining Tenants
Providing value to tenants by empowering them to appeal to new talent is one piece of the puzzle for finding the best tenants for commercial properties. Relationship building has become more important than ever before, and CRE owners and operators will need to make tenant satisfaction a top priority.
Did you know that, according to research from HqO, 76% of CRE landlords collect annual surveys to keep in touch with tenants? But with the industry changing so fast — and tenant and employee needs following suit — annual data collection is not frequent enough to keep pace.
To make sure you have a real pulse on tenant experience and increase tenant satisfaction, you’ll need to:
- Enable a data-driven leasing strategy that aligns building and tenant needs
- Enhance communication and feedback loops with all tenant employees
- Become a critical component of tenants’ talent and workplace experience strategy
- Engage with tenants every day
Your tenants can’t be successful in meeting their goals if they aren’t properly connected to the property team. Tenants want to be valued. They want to feel heard if they have a complaint. And your tenants need to be able to easily contact your team.
Focus Area #3: Building Tenant Loyalty
Providing a great tenant experience allows CRE leaders to differentiate from the competition and build a brand that leads to tenant loyalty. As property owners and operators, you have several clearly defined goals to break through competition as you work at retaining and finding the best tenants. It’s starts with everything discussed above and more.
Here are four tips to help increase awareness of your brand as you work to attract and retain the best tenants for commercial properties.
- Focus on providing a great workplace and tenant experience. Provide the amenities employees want so you can help your tenants attract and retain their talent. All this fosters tenant satisfaction and loyalty.
- Connect amenities. For example, activate your building or office community with industry-leading order-ahead, delivery, and convenience services. Or, address commuter pain points with an app that connects them to their preferred public transportation, micro-mobility, shuttle, and parking solutions. Give tenants an easy way to access gym waivers, hours and schedules, or obtain discounted health perks.
- Increase your building’s desirability and brand recognition. When you provide a great workplace and tenant experience, you’ll grow loyalty. Loyalty leads to the ability to increase rent for current tenants. Brand recognition attracts new, high-quality tenants.
- Implement digital tools that allow tenants to engage with you and their colleagues all in one place. Look for tools that allow you to create content and event programming and take advantage of out-of-the-box, pre-built tenant engagement programs. Enable users to communicate updates, share details on local events, or request services from other tenants through an easy-to-use mobile platform.
Find & Retain the Best Tenants for Commercial Properties
Tenants want quality, and they seek that quality through experiences. As inflation increases and rent skyrockets, tenants will look for quality spaces that provide better workplace experiences. It’s up to you to provide spaces tenants want to return to.
Smart CRE landlords will recognize the opportunity they have to lean into the tenant experience to:
- attract new demand;
- build loyalty and retention with current tenants; and
- adapt to survive in a world that has changed the workplace forever.
Learn more about how to find and keep the best tenants for commercial properties in our interactive eBook, “How to Create Commercial Buildings that Attract and Retain Occupancy.”