In the current circumstances of COVID, the property needs of businesses in the short and longer term are being questioned, with many organisations biding their time with short term solutions, requiring little or no capital outlay. Naturally, this and the amount of sublease and surrendered space on the market has influenced the considerations of landlords and their agents.
With over sixteen years’ experience in helping landlords, agents and end-users with fit-out, Morphos has a great deal of insight to share. Here are some of the considerations involved in the work we are doing with building owners relating to spec tenancies today.
New vs Old
Pressure on capital outlay prompts willingness for some compromise and a second look at potential in existing fit-out is a good place to start. Morphos has been helping a number of landlords review potential in existing spaces and coming up with cost effective solutions. Painting, upgrades to lighting, flooring, furniture and some feature items can breathe new life into a space; enough to attract the right tenant and fit a limited budget.
Multiple lease terms
Shorter leases mean that landlords need to get more than one lease term out of their investment in a spec tenancy or refurbishment. This places a greater need to provide a space that will stand the test of time in design aesthetic, as well product and material longevity.
Spec tenancies have in the past been targeted mostly to small-medium sized tenants, with bigger business generally seeking bespoke spaces that include facilities tailored to their needs, however the changes to the way we work in recent times, coupled with the long term uncertainty for many businesses has seen increasingly larger occupiers seeking fitted out space and spec tenancies.
Less is more
In an effort to reduce capital outlay, landlords are looking to maximise the appeal of the space without breaking the bank. This means finding the perfect balance between creating a turnkey space and spending money on areas of the fit out that will attract the most attention, translating to greater demand for the space.
Health & Wellbeing
Employee satisfaction has been an increasingly important factor in office design over the years and in our current COVID situation, health and wellbeing has climbed the ladder of priority within the workforce. Building an office environment that is safe and promotes wellness and comfort, leading to more positive outcomes for employees and employers is a common requirement and consideration today. Solutions for appropriate distancing and density, touchless operations, exclusivity and/or usage and cleaning monitoring have all been added to the conversation. Of course, aspects such as the influence of greenery, natural light and solutions that encourage movement and meaningful breaks remain key components to a healthy workplace.
Flexible work spaces have become an important aspect of a spec tenancy, ensuring they cater to the many different working styles and arrangements of a potential tenant. Generous kitchen/breakouts, a mixture of meeting spaces, both formal and informal, as well as touchdown points, hot desks and collaborative spaces have all been adopted into the way businesses work. Flexible spaces are becoming prevalent now more than ever, with businesses becoming more open to work-from-home and flexible working in the wake of COVID. Flexible options also provide for potential of easy and cost-effective tailoring for unique requirements or enabling alterations as a tenants needs may change over time.
In order to attract potential tenants in a market with high demand for fitted spaces, spec tenancies are becoming increasingly reliant on aesthetic appeal. Aspects of the build that were once a nice-to-have are now a must, with premium finishes such as stone benchtops, timber floors, bespoke design elements, custom joinery, exposed ceilings and feature lighting becoming standard inclusions.