Providing ‘Livable’ Spaces and Amenities
for Tenants Is One Thing,but Dry Cleaning?
Making tenants’ lives easier has become common practice in the world of business parks and office campuses. Especially in the tenant-friendly office campus environment, developers begin their projects with the future occupant in mind.
Fiber optics, open workspaces and even Zen gardens are now part and parcel of many new developments. But at least one local company, Enfrastructure Inc., is pushing the envelope by planning a vast array of services drawn from the incubator model, and it has many wondering just how far the coddling of tenants will go.
According to many, The Irvine Company first upped the ante years ago by developing campus environments that emphasized upscale working conditions for tenants.
“Landlords are mindful of the needs of tenants,” said Clyde Stauff, senior vice president of Colliers Seeley International Inc. North County.
“They used to get away with not maintaining property,” Stauff said, but not any longer.
“The Irvine Co. set the standard. Now, properties look new even if they’re 20 or 30 years old,” he said.
Bob Williams, president of the Irvine Industrial Co. unit of The Irvine Company, said the firm saw a need to cater to the tenant.
“As we move forward, we’re always looking to stay ahead of the curve,” said Williams. “We attempt to imagine what tenants want in the way of amenities. And we constantly are looking to improve by adding amenities: sports parks, better people places, convenient shopping.”
Williams added that a key to the tenant satisfaction is having infrastructure in place. In today’s business environment, redundancy of lines, high-speed Internet access and backup power have become standard. And, with the problems facing California’s utilities, a landlord’s ability to provide quality technical and data sources makes them attractive.
Beyond those technical needs, landlords like Parker Properties have taken tenant needs a step further with heightened attention to landscaping, proximity to shopping and restaurants and amenities like parking structures.
“We did not want that ‘sea of parking,’ ” said Russ Parker, principal of Parker Properties. Parker also placed emphasis on tenants’ state of mind by developing “people places” and “business bungalows,” areas outside the regular work space where employees can get away for a few moments and clear their minds. Other funky amenities include Zen gardens and think tanks. Such ventures are more costly to the developer, but all come with one goal in mind: to make working conditions more livable and attractive to current and potential tenants.
“Landlords have to be good landlords,” said Tim Joyce, senior vice president of Colliers-Seeley International-South County.
The tenant is a daily customer for the landlord, a fact the landlord must constantly keep in mind, so that the tenant will renew the lease, according to Joyce.
“Retention is much more important than the initial landing of the business,” Joyce said.
But how far must a landlord go to ensure the tenant will renew? And how much is too much?
Enfrastructure Inc., for one, is taking landlord services to sycophantic levels.
The Aliso Viejo-based company wants to build parks that provide businesses with a boatload of full-service support and amenities, from computer hardware and software, to human resources, accounting, office supplies and even dry cleaning.
Although it doesn’t use the term “incubator,” Enfrastructure is something of a landlord-incubator hybrid. The newly formed company wants to make its mark by making tenants’ lives easier. So working for the tenant is part of the company strategy.
“We are a full-service provider of business services, from computers and telecommunications needs to paper clips and coffee,” Enfrastructure President and CEO James Watson said. “We would like to see buildings have enough power available to meet the demands of the tenants, a telecommunications infrastructure in place, fiber optics in the ground, and capability within the facility to handle the loads of high-tech companies.”
“Enfrastructure is a business-space provider with significant technical overlay,” said Watson. “Our goal is to seek out clients that are interested in getting services outsourced.”
“We don’t want tenants busy worrying about real estate, technical, communications and financial problems,” Watson said.
But Enfrastructure offers incentives most traditional landlords would not be willing to touch.
But both Parker and Enfrastructure, which makes its home out of Parker Properties’ Summit Office Campus, agree that they are not competing for tenants because Enfrastructure offers services beyond Parker’s realm.
But these traditional landlords,no matter how far they’re extending to make the working conditions of their tenants better,still do not reach the levels of what Enfrastructure proposes. Which has raised eyebrows about the services Enfrastructure plans to extend.
The bigger question to ask is whether traditional landlords will be willing to follow suit and go above and beyond what they usually provide tenants. The major players in Orange County said they are not, drawing the line at running errands for dry cleaning or balancing the accounting ledger of clients.
“The irony is that tenants come in with wish lists of requirements, but once it’s all on the table and they’re confronted with the price, that’s where the rubber meets the road. Then, tenants have to analyze the situation,” said Robert Flaxman, CEO of Crown Realty. n
