Last week, the Building Engines team packed up our bags and headed over to Salt Lake City, Utah for the 2019 BOMA International Conference and Expo. BOMA’s flagship event is a great place to meet with clients and partners, collaborate with industry leaders on top market trends, and dream about the future of the commercial real estate (CRE) industry.
Thematically, this year’s conference was built on 2018’s unofficial tag line: “The Year of the Tenant Experience.” CRE professionals seem to be focusing their customer-oriented thoughts in two directions: adopting a hospitality-focused management model and winning the “amenities race” to attract new tenants. A third more general theme of market uncertainty also peeked out from the background several times in Salt Lake City. Here are a few notes and reflections on what we heard:
- If you want to win in today’s CRE market, you need a hospitality-centric management approach
This theme was emphasized continuously in the conference’s educational program, including in our own presentation, “Tenant Experience Hot Takes.” But nowhere was it more evident than during the Tuesday Keynote – “Release the Wonder of Commercial Real Estate: Lessons Learned from Disney U and The House of Wonderful,” presented by Doug Lipp, Former Head of Training, Disney University, and Peter Merrett, Speaker and Genie of Wonder, The House of Wonderful.Using a unique and captivating presentation technique, Doug and Peter shared some “gems” that ultimately lead to enhanced customer service. How can CRE cope with the challenges of standing out in the marketplace, of delivering a human experience, and of adapting to the changing workplace: By creating a culture that is unmatched, forming and preparing property teams to “go higher” in service of customers.As Doug Lipp said, “the culture is more important than a pretty castle.” You can have the best class-A building, but if you’re not fostering the correct culture for your tenants, why would they stay?One way to begin doing this is to change the language we use. What if, mused Peter Merrett, our industry stopped using the word “tenants” and instead treated them as “guests”? What if our team “meetings” became “gatherings”? And what if the first thing we switched on at the office wasn’t the lights, the coffee machine, or the computer, but our people? This is the kind of hospitality mentality that CRE needs to in order to provide the experiences “guests” want.
- The Amazing [Amenities] Race
Ready, set, go! Now please just stop. It’s overwhelming how many new apps and tenant amenity services are hitting the CRE market. What do you think your tenants want? You shouldn’t be guessing, you should know. This is something we addressed in our Tenant Experience Gap Report.In Henry Chamberlain’s always highly-anticipated annual keynote address, he called the workforce “digital nomads”. Your guests want to work in flexible space, they want the latest technology, they want everything – so how will buildings choose to compete? Michael Giese, SVP, GlenStar Properties, addressed the challenge of tenant amenity decision- making in an educational session, simplifying it down to this: modern engagement. There are several buckets of amenities tenants need to be not just happy, but fully engaged at your property:- Experiential: Live/work/play space, a customized, hospitality “feel” to your building
– Social: Community, interactions, events, activities, and digital media
– Convenience: Services (e.g. oil changes in your building garage), variety, learning, and technology
– Wellness: Fitness, nutrition, and education.
– Giving: Philanthropic, charitable, corporate welfare, volunteerism, environmental, and sustainability.Having amenities at your property that fit into each of these buckets will not only make you stand out; they will help you retain your tenants for the long haul.
The “Tenant Experience Hot Takes” session, hosted by our own Head of Research Phil Mobley, continued on the theme of amenities. Property management leaders Missy Quinn of Cushman & Wakefield and Todd Mitchell of Columbia Property Trust shared their creative wisdom about competing in ways other than throwing money at the latest physical amenities.
For example, Missy and Todd each shared a story about food service amenities. At one of Missy’s properties, her team closed down an in-place cafeteria, opting to convert it into meeting space. To meet tenants’ needs for variety, they began inviting food trucks to the property. In the process, they not only saved money on an expensive conversion, but added something that wasn’t there before.
For Todd, the answer was nearly the opposite, though equally successful. His team put in a cafeteria-style amenity that serves a variety of menu options to meet the needs of a diverse occupant base. In both cases, the key to success came in understanding each property’s unique offering—and NOT in following the crowd.
- Market uncertainty
Everyone is a little uncertain about the CRE market over the next few years, and if anyone says otherwise…well, you may not be speaking with a trustworthy person.Amy Webb, Founder, Future Today Institute presented the opening keynote this year. She delivered advice on how to identify and approach uncertainty. What uncertainties are we seeing in 2019? “Political insanity”, climate instability, new geopolitical alliances, human migration, China, technology, a global economic slowdown…do you feel better now?So…what do we do? We can’t predict the future. But we can make connections with data to reduce uncertainties. This helps us understand the difference between what are trends (e.g. editing plant genomes and drone-based last-mile logistics) and what’s merely trendy (flying cars, anyone?). Once we do, we can confront uncertainties head-on.The future is scary, but with all the new technology that is taking over the world we can collect more data than ever – behavioral data, human data, biometrics. The world is confronting this technological uncertainty head-on, just as Amy mentioned. Is the CRE industry doing the same?Our last takeaway – our BOMA friends like beer! This year, Building Engines hosted a beer tap at the booth and had great discussions with industry leaders about their personal challenges at their CRE properties. If you missed us and would like to learn more:
- Prism™ by Building Engines – our brand-new platform
- Bengie™, the CRE industry’s first automated chatbot
- Our recent acquisition of Real Data Management can help you increase revenue at your property
See you next year in Philadelphia!