The popular narrative that companies are moving to dense urban areas with a preference for open, collaborative spaces in a bid to placate and attract younger employees may not be the full story.
Examining how millennials, technology and e-commerce are shaping commercial real estate, researchers, brokers and marketing professionals gathered at a recent conference hosted by Saul Ewing LLP, agreed changes in the office space attributed to millennials wouldn’t be happening if older workers didn’t like them, too.
“Moving to an open floor plan wasn’t something that only millennials like. It was something everyone liked,” said Sara B. Queen, executive vice president of New York-based Brookfield Property Partners said.
Edwin R. Brake, managing director for accounting firm Ellin & Tucker, can speak to the divide firsthand. The firm’s new office space at 400 E. Pratt St. was a huge departure from previous spaces and put a heavy emphasis on innovation, Brake said in an interview Friday.
The new workspace features more open space with lower work stations and fewer isolated offices. It even includes a “fun space,” a multimedia center with a bar and fridge stocked with beer.
Brake said he kept most employees in the dark during the planning stages for fear they would complain simply because of the change.
Younger employees loved the space immediately, he said, while some older employees were not as thrilled. He asked skeptics to give it 90 days. Now, some of the biggest critics have embraced the new space, he said.
“They’re not opposed to it,” Brake deadpanned.
Younger employees may drive changes in working spaces, but older workers typically occupy the management positions that decide about the type of office and where a firm will be located. So if the older workers were not on board and embracing the changes they wouldn’t be happening.
“Behaviors are changing,” said Bronwyn E. LeGette, vice president at Cushman & Wakefield.
Some trends in commercial real estate, ostensibly being driven by technology-obsessed youth, range from smart buildings aimed at making an office more efficient and comfortable to “well buildings” that are built to promote health. Although some of these changes could be viewed as catering to the whims of millennials, some have both practical and performance impact.
A study published this summer in the journal Nature Climate Change showed women often feel colder in an office than men. That’s often amplified because indoor climate regulations were set on a model from the 1960s, when offices were dominated by men. In the modern workforce, with more female employees, a smart building that allows for greater climate control can be very attractive amenity.
But whether these modern workspaces will continue to be located primarily in urban areas or will begin migrating to the suburbs is up for debate.
“People like living in cities, and we’re going to see that grow, and grow and grow,” Queen said.
But Adam Ducker, managing director Bethesda-based RCLCO, pointed out that most corporate executives still prefer to live in the suburbs. Recent polls have shown the majority of Americans still embrace the suburban idyll as their preferred lifestyle. There’s also the fact that suburban office space is often cheaper than city competitors.
“The price trade-up to me seems compelling, but pick wisely,” Ducker said.