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Monthly Archives: April 2017


Philadelphia Office Vacancy Rate Drops Below 9 Percent

The Philadelphia Office market ended the first quarter of 2017 with a vacancy rate of 8.7%.

The vacancy rate was down from the previous quarter, with net absorption totaling positive 173,096 square feet in the first quarter in the commercial real estate market – including Philly office space, Philly retail space and Philly industrial space. That compares to positive 1,080,044 square feet in the fourth quarter 2016. Vacant sublease space increased in the quarter, ending the quarter at 1,112,547 square feet.

This CoStar report on Philadelphia commercial properties is being offered through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

The Class-A office market consisting of Philadelphia commercial real estate properties recorded net absorption of negative 588,125 square feet in the first quarter 2017, while net absorption for the city’s central business district was negative 4,710 square feet.

Tenants moving into large blocks of space in throughout the Philadelphia commercial real estate markets so far in 2017 include: Ashfield Healthcare moving into 82,000 square feet at 1100 Virginia Dr; WeWork moving into 55,238 square feet at 1900 Market Street; and Holy Redeemer Health System moving into 36,000 square feet at 201 Veterans Way.

Rental rates among Philadelphia commercial real estate listings ended the first quarter at $22.68, an increase over the previous quarter.

A total of six buildings delivered in the quarter to the commercial real estate market – including Philly office space, Philly retail space and Philly industrial space –totaled 214,556 square feet, with 4,398,979 square feet still under construction at the end of the quarter.

This trend among Philadelphia commercial real estate listings is compared to the U.S. National Office vacancy rate, which stayed at 9.7%, relatively unchanged from the previous quarter, with net absorption positive 10.78 million square feet in the first quarter. Average rental rates increased to $24.44, and 339 office buildings delivered this quarter totaling more than 21.29 million square feet, with 154.4 million square feet still under construction.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) or Andrew Maristch (drew.maristch@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate is a Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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Top 5 Challenges of Commercial Industrial Solar Energy

Commercial Industrial Solar EnergyCommercial Industrial Solar Energy is a great solution for many businesses. Many are taking advantage of commercial industrial solar energy however, there are some issues to be considered.

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Thousands of commercial and industrial business owners have already installed solar energy and are enjoying the benefits of free energy from the sun, but that doesn’t mean solar is an easy solution for every building. There may be challenges inherent in the rent roll of tenants, or even in the physical structure of the building itself.

Below, we summarize the top five challenges to commercial solar projects that we see most often. In most cases, these challenges can be overcome – either by aligning landlord and tenant incentives, designing creative engineering solutions, or structuring financing and tax incentives.

Commercial Industrial Solar Energy Challenges

1. LANDLORD-TENANT ALIGNMENT
While not a problem for owner-occupied buildings, issues sometimes arise with landlord-owned properties. For example, a landlord might be interested in commercial industrial solar energy, but their tenant controls the electric meter in their name and pays directly for electricity. The landlord has little incentive to invest in a benefit accruing only to the tenant. A solution would be for the landlord to own the solar and sell the electricity back to the tenant. But, even this structure could be risky, if the tenant’s lease expires within the next 1-3 years. Conversely, a tenant on a decades-long lease may prefer to own the solar panels outright, but the landlord may not see the benefit, or has concerns about installing solar on their roof. In other cases, a flex building might be ideal for solar energy, but the building has dozens of tenants, each with their own electric meter and various lease terms/ expirations. In each of these scenarios, creative structures can allow for solar and produce incremental benefits for both landlord and tenants.

2. ELECTRICAL LOAD
Many industrial buildings have large rooftops capable of accommodating extensive solar energy installations. In general, however, commercial industrial solar energy is limited in sizing to offset the annual electric bill on the metered account within the building. Large industrial buildings often serve as warehouses without the electric bills that accompany heating, cooling and industrial processing, thus capping the size of a potential solar installation. To leverage solar energy, it might make sense to convert gas or propane equipment to electrical equipment. In other cases, it may be worthwhile to fill a large rooftop with solar panels and re-direct the electricity not to the building, but directly onto the grid.

3. ROOF AGE
Solar panels are warranted for 25 years and last 30-40 years. This timeline may present problems if not aligned with the age of the underlying roof. If solar panels are installed and the roof then needs to be replaced, the building will incur incremental expenses to remove the solar panels, replace the roof and then re-install the solar. For any roof less than 5 years old, the remaining lifetime of the roof lines up perfectly with the lifetime of the solar installation, so this is not a problem. Conversely, for any roof 15-25 years old, it can be more cost-effective to replace the roof in conjunction with a solar
panel installation. In some cases, it may make sense to accelerate a planned roof replacement by a few years in order to undertake a solar installation sooner. When installing solar on a roof, it is critical that your solar installer and roofer work together to integrate the two systems.

4. STRUCTURAL
On the East Coast, rooftop solar is mostly secured by ballast and not attached to the roof with penetrations. Solar panels will add some additional weight on a building – generally 3-6 psf. Many buildings are built to withstand this additional weight, however it is critical that a qualified structural engineer inspect a building to determine its structural capacity. Many pre-fabricated “Butler-style” buildings were not built with much incremental capacity and should be carefully analyzed. Solar can be engineered to minimize its weight and work within the constraints of the building.

5. CAPITAL
Business owners have many competing uses for their capital, and there are always internal needs of the core business – both operating and growth. Solar can offer returns that exceed investments in core operations, but solar is still considered a “nice to have” rather than a “must have.” To address this issue, the solar industry has created financing structures that are recourse to the solar project only. These structures are non-recourse to a company or its balance sheet and have no impact on a company’s ability to borrow or use funds for core operations. In many cases, lenders prefer a solar investment because it is less risky than core operations and it improves the financial stability of their borrowers. A good solar installer should not steer you to their preferred financing structure, but rather help you explore the many solar financing options available to your company.


Keith Peltzman
President & Founder
1008 Astoria Boulevard
Suite E
Cherry Hill, NJ 08003
856.393.1250

 

 

ABOUT US
independence solarKeith Peltzman is president and founder of Independence Solar with offices in Cherry Hill, NJ and Boston, MA.
Independence Solar is a turnkey installer of commercial solar energy. Since 2007, the team has developed and built over $200 million of solar projects, including the largest rooftop solar array (9 MW) in North America at the Gloucester Marine Terminal in NJ. Independence Solar forges long-term partnerships to maximize returns on our customers’ solar energy investments.

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Restrained Optimism Reigns in Latest CRE Growth Forecast

Reflecting what might be described as restrained optimism, the latest Urban Land Institute (ULI) Real Estate Consensus Forecast, just released by The CoStar Group, sees a more modest rate of growth among commercial real estate (CRE) transactions from the frenzied pace seen in recent years.

The forecast, based on a survey last month of 53 real estate industry economists and analysts representing 39 real estate organizations in the commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – sees continued growth in CRE fundamentals but at a more muted pace over the next three years.

While respondents were more optimistic compared with the previous ULI consensus survey in October about the performance of the warehouse and industrial sector of U.S. and Philadelphia commercial real estate properties, they were less bullish on the apartment, retail and office sectors compared with six months ago.

“The results reflect a certain lowering of expectations for the next three years relative to recent years,” said Anita Kramer, senior vice president, ULI Center for Capital Markets and Real Estate, in relation to the U.S. and Philadelphia commercial real estate markets, “but growth is still positive and – in several cases – better than long-term averages.”

This CoStar report on national and Philadelphia commercial properties is being offered through Philadelphia commercial real estate broker Wolf Commercial Real Estate, a Philadelphia commercial real estate brokerage firm.

While job and income growth are expected to remain positive for national and Philadelphia commercial real estate listings in coming years, forecasters were reluctant to upgrade real estate fundamentals or returns, said survey participant William Maher, director of North American strategy and research at LaSalle Investment Management.

Total CRE sales transaction volume is expected to continue stepping down from the record $547 billion in annual transaction volume achieved in 2015, and is projected to drop another 8 percent this year from 2016’s $489 billion total sales volume.

Respondents to this survey on the U.S. commercial real estate market – including Philly office space, Philly retail space and Philly industrial space – said they expected total sales to hold steady at $450 billion in 2018 before dipping to $430 billion in 2019.

With the prices of U.S. and Philadelphia commercial real estate listings are projected to grow at subdued rates in the next three years, total institutional-grade real estate assets are expected to provide average returns of 7 percent this year, dipping to 6 percent in both 2018 and 2019.

For more information about Philly office space, Philly retail space and Philly industrial space or other Philadelphia commercial properties, please call 215-799-6900 to speak with Jason Wolf (jason.wolf@wolfcre.com) or Lee Fein (lee.fein@wolfcre.com) at Wolf Commercial Real Estate, a leading Philadelphia commercial real estate broker that specializes in Philly office space, Philly retail space and Philly industrial space.

Wolf Commercial Real Estate is a Philadelphia commercial real estate brokerage firm that provides a full range of Philadelphia commercial real estate listings and services, marketing commercial offices, medical properties, industrial properties, land properties, retail buildings and other Philadelphia commercial properties for buyers, tenants, investors and sellers.

Wolf Commercial Real Estate, a Philadelphia commercial real estate broker with expertise in Philadelphia commercial real estate listings, provides unparalleled expertise in matching companies and individuals seeking new Philly office space, Philly retail space or Philly industrial space with the Philadelphia commercial properties that best meets their needs.

As experts in Philadelphia commercial real estate listings and services, the team at our Philadelphia commercial real estate brokerage firm provides ongoing detailed information about Philadelphia commercial properties to our clients and prospects to help them achieve their real estate goals.  If you are looking for Philly office space, Philly retail space or Philly industrial space for sale or lease, Wolf Commercial Real Estate is the Philadelphia commercial real estate broker you need — a strategic partner who is fully invested in your long-term growth and success.

Please visit our websites for a full listing of South Jersey and Philadelphia commercial properties for lease or sale through our Philadelphia commercial real estate brokerage firm.

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A Shift in Office Design Trends

office design trends

Rose Tree Corporate Center: Media, PA

There has recently been a shift in commercial office design trends to incorporate more residential and hospitality elements. The office of the last 30 years reflected the ‘organizational office’ structure with the Boss in the best corner windowed office, his/her associates situated next door, support staff seated in cubicles, and the lunch room in the interior. Your rank was determined by office size and amount of windows. There was a separation of decision makers from the workers.

The onset of the computer started to change these office design trends in which all employees regardless of hierarchy could type their own work. The relationship of support staff and decision makers started to adapt. You see this reflected in the ratio of support staff to executives. In corporate law firms what used to be a 1-1 ratio can now be as many as a 5-1 ratio.

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Office Design Trends Pushed by Millennials

Hirtle Callaghan: Conshohocken, PA

Over 75 million millennials aged 18 to 35 have entered the workplace in which they challenge autonomy, flexible hours, and ample options on where and how to work. Today’s technology has pushed us far from traditional office operations and caused a large impact on the office design trends. The staff has become unfettered from their desks and has the ability to work freely within or out of the workplace.

This along with the rising cost of real estate has made the once standard large office of 300 square feet almost disappear. Our electronic-dependent work creates a need for more diverse spaces to work. The amount of drywall partitions changed and open plan work stations with low panels prevailed.

The integration of technology is no longer limited to a conference room or a work surface. It has become readily available throughout the break out spaces which allow for better and faster communications.

Dean’s Suite at Wharton School: Philadelphia

Interior glass is now a prominent element in the work place to welcome natural light and creates openness in the office that engages executives and support staff alike. Staff is spending much more time in the office therefore they want it to feel more like home. This has forced a collapse of the boundaries between staff and work associated spaces. More creative environments are being designed. Elements from hotel and residential interiors are being introduced in to the office. There are café’s instead of lunch rooms, wellness centers, living room- like meeting spaces, and conference rooms with top shelf food & beverage opportunities. Many offices use their reception areas as entertainment spaces for their clients. Suburban office parks are re-visioning their public space and large lobbies are now incorporating break areas and food opportunities Due to new office design trends we recommend companies create an audit to see how they can improve the office dynamic and create a nourishing space. This can be accomplished by asking these simple questions:

 

Office Design Trends #1. Generic standards vs. actual needs

Can you reduce the rentable square footage by understanding exactly what each staff group needs to feel comfortable in t heir job?

Office Design Trends #2 Support of how different people work

Does the staff have adequate access to private and collaborative spaces as their job requires and as each individual can be most productive?

Office Design Trends #3 Occupying a healthy environment

• Does the HVAC properly vent heat and cool?
• Are the lights LED which are closer to natural light or are they artificial light (florescent)?
• Is there exposure to natural light?
• Is there visually stimulating color and patterns?
• Are vending machines filled with healthy enriching snacks or sugar and carbohydrates?

Floss Barber

*All Images Shown are of Floss Barber, Inc. Projects

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Commercial Real Estate Documents: Don’t Overlook The Fine Print

Commercial Real Estate DocumentsCommercial real estate documents are critical to all parties of a real estate transaction. If there’s ever a disagreement, the fine print in your commercial real estate document shouldn’t be overlooked.

Click here to download the PDF.

With Passover and Easter this week, a lot of folks are traveling the skies to be with loved ones for the holidays. In the wake of last weekend’s passenger removal fiasco on United, chances are they may be browsing their airline’s contract of carriage for the first time ever.

As I wrote earlier this week, the fine print in commercial real estate documents can sometimes contain surprises all around. It turns out the infamous United flight wasn’t even “overbooked” by United’s own definition, a precondition to invoking the “denial of boarding” clause.

Moreover, there wasn’t any justification in the contract for removing seated passengers based on overbooking or crew needs once they’ve boarded. Nonetheless, United summoned the long arm of the law to enforce an erroneous (or nonexistent) interpretation of its own agreement – and it apparently was not the first time this has happened.

Is there a connection to commercial real estate documents? Yes. Don’t overlook the fine print, and don’t assume an agreement says something merely because everyone acts like it does.

Parties to real estate transactions may be so accustomed to a way of doing business, or so focused on the financial terms and getting the deal done, that standard or “boilerplate” clauses often get overlooked. That’s usually not a problem – until there’s a disagreement. Here’s a sample of just a few:

  • Notice provisions for termination and renewal. When can a lease be renewed or terminated, and how must notice be given? The methods and timelines contained in these clauses in your commercial real estate documents may be strictly interpreted; don’t assume there is a lease renewal just because rent continues to be paid.
  • Surrender clauses. Do you remember what your space looked like before you moved in 10 years ago? Your lease probably requires you to return it to that condition when you leave.
  • Forum selection and costs. The lease may require that another state’s contract law be applied to disputes, or even require disputes to be litigated in a jurisdiction hundreds of miles away. If there’s a binding arbitration clause, you may be precluded from access to the courts. Leases may also require payment of attorney’s fees, court costs, and/or or predetermined “liquidated damages.”
  • Merger/Entire Agreement clauses. Handshake agreement? You might want to get in it writing: a merger clause specifically provides that the agreement of the parties is wholly contained within the contract, thereby barring any side agreements.
  • Indemnity and Defense. Leases may require a party to defend, indemnify, and/or hold harmless another party for its wrongdoing or breach. Make sure it is clear what the scope and extent of the obligation is, and that insurers are aware of lease obligations.

Rarely is there a “form” commercial lease; most are individually crafted for the property and the parties involved. Unlike many take-it-or-leave-it consumer contacts, it is generally assumed that both parties to a commercial lease are sophisticated, and equally able to bargain lease terms at arms length. As a result, courts will more strictly enforce commercial lease provisions even when the result may seemingly be harsh.

There may be instances where there’s a compelling business reason to deviate from a prior agreement. In that regard, there’s one lesson that United apparently hadn’t learned: there’s not many problems where a little more money won’t induce people to get on the same page.

(One final thought on “overbooking” for you landlords out there: wouldn’t it be nice if you could lease 110,000 square feet in a 100,000 square foot building…. and not go to jail for it?)

ABOUT WCRE
Wolf Commercial Real Estate is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial, and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial landlords, tenants, investors, developers, banks, commercial loan servicers and companies, guided by our total commitment to our clients and our community. Our team is devoted to building successful relationships, and we provide each client the highest levels of responsiveness, attention to detail, and communication even after the transaction is complete.

ABOUT THE AUTHOR
As Vice President of Corporate Strategies, Tony will work closely with the firm’s sales professionals to spearhead the growth of the WCRE brand in southeastern Pennsylvania. With more than twenty years’ experience in the legal and political arenas, he also brings a unique, multidisciplinary perspective that will help WCRE clients identify potential obstacles and capture new opportunities.

Tony has a deep understanding of the issues and people key to the real estate landscape in the region, having built trusted relationships with government and private sector leaders in both Harrisburg and Philadelphia. He has been actively involved in many civic institutions in Philadelphia, from community associations to advocacy non-profits.

FOR MORE INFORMATION:

Anthony V. Mannino, Esquire
Vice President, Corporate Strategies
Wolf Commercial Real Estate
anthony.mannino@wolfcre.com
O 856 857 6300
D 215 799 6140

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Attracting and Retaining Talent with Well-Designed Workplaces

Attracting and Retaining Talent1Let’s explore attracting and retaining talent with Well-Designed Workplaces because at the end of the day: IT’S MORE THAN JUST A PAYCHECK. Keeping workers satisfied through compensation is a high priority for organizations desiring to lower turnover rates, which can have negative effects on profitability and morale. But for many people, their job is more than pay and benefits. Where they work—and what their organization stands for—carries significant weight. What makes one organization more attractive than another to existing and prospective employees lies in its core values, which are expressed through its culture and brand. These values are weighed differently among individuals—and among generations.1

Today it’s more critical than ever for organizations to attract and retain top talent, and one component that can be used for recruiting, but is often overlooked, is the workplace. It’s more than just desks and chairs. Research shows that the work environment accounts for up to 25% of job satisfaction.2 Offering workers an attractive package that includes fair compensation is one way to help keep workers satisfied. The next step is for organizations to invest in a well-designed workplace that communicates its commitment to company values and brand.3

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Attracting and Retaining Talent – NEW Talent

Attracting and Retaining Talent1Because any work environment is likely to include members of four generations—Veterans, Baby Boomers, Generation X and the Millennials—it must accommodate the needs of a wide range of ages.4 In the last U.S. Census, the number of Millennials already surpassed the number of Baby Boomers by population.5 As the Boomers retire from the workforce, employees from Generation X and the Millennials are beginning to replace them. But the preferences and workstyles of the Millennial cohort have received much attention because of its size. Organizations that consider Millennial values will be the most successful.6

Attracting and Retaining Talent1The Millennials are the generation born during or after the general introduction of digital technology, in the last decades of the 20th century. Digital Native expert Marc Prensky claims “they have spent their entire lives surrounded by and using computers, videogames, digital music players, video cams, cell phones and all the other toys and tools of the digital age.”7 They are tech-savvy and used to being connected from anywhere. They grew
up with the Internet at their fingertips for entertainment and social activities, and now use it for business tasks. They are globally connected, flexible and collaborative because they have developed different communication styles due to advanced technologies such as social media. They are entering the workplace—and transforming it forever.8 Although they have many of the same needs as previous generations, Millennials are different in how they approach work, communicate and integrate technology into their daily lives. Research from Johnson Controls reveals significant findings that organizations should consider for attracting younger workers and accommodating their workplace preferences:

• They value sustainability.
• They’re flexible, mobile and unconventional.
• They prefer collaboration and interaction in the workplace.
• They demand to be connected 24/7.
• The workplace is a space they emotionally engage with—where they socialize.
• The workplace should support their health and well-being.
• The lines between their business and social worlds blur, and they often use the same devices for both.
• They want faster computers, more frequent software updates and higher Internet speeds.9

Organizations are challenged to commit to the values that workers—especially Millennials—are seeking, from corporate social responsibility (CSR), to work/life balance, distributed work, and health/wellness.10 And they are challenged to create work environments that attract younger employees without excluding the other generations.11

The role of Corportate Social Responsibility in Attracting and Retaining Talent

Attracting and Retaining Talent1Both Generation X and the Millennials consider sustainability—an element of corporate social responsibility (CSR)—a core value.12 Sodexo suggests “initiatives that represent the passion and commitment of people who choose to live their values through their work” are related to job satisfaction, motivation and intent to remain with the organization. 13 And “organizations that inspire people to connect with their community and create meaningful, sustainable work environments are able to retain top talent, especially among the younger generations.” 14 Sustainability—which used to be a special feature in office environments—has now become standard, with organizations “incorporating recycled products (including buildings), locally sourced and sustainable materials, energy-efficient HVAC systems and better indoor air quality.”

Making sustainability a design principle of the workplace helps turn the work environment into a tool for attracting and retaining top talent.15 The Millennials are known for having social consciences, which is why they’re drawn toward organizations that are committed to CSR. Sustainability is now a “must have” rather than
a “nice to have” when it comes to attraction and retention.16 And why not? Research shows that people who work in sustainably designed environments benefit from better health, decreased depression rates, improved sleep patterns and less eye strain.17 It’s a principle that works for all generations.environments benefit from better health, decreased depression rates, improved sleep patterns and less eye strain. 17 It’s a principle that works for all generations.

The role of Work/Life Blending in Attracting and Retaining Talent

Attracting and Retaining Talent1Organizations today are challenged with how to help employees blend their workload with their personal responsibilities, presenting creative benefits and perks to entice them. Technology has enabled work anywhere, which means people are accessing e-mails from mobile devices 24/7. To compensate, many companies are offering casual, flexible and fun policies—including unlimited vacation days, gym memberships, relaxed dress codes and childcare, to name a few.18 The Society for Human Resource Management (SHRM) suggests “workplace flexibility has a positive impact on employees’ worklife experiences. These low-cost initiatives can lead to increased employee job satisfaction, lower turnover and lower insurance costs.” 19 They can also encourage creativity and foster innovation by requiring people to get away from their routine by taking a sabbatical, for example. In a recent study, SHRM determined 53 percent of organizations offer flextime, in which employees can choose their work hours. Companies benefit from offering these options to workers by attracting and retaining people who can’t fit into a typical schedule working 9 to 5.20

Not every perk or benefit fits for every organization, however. They shouldn’t be standard across organizations—it depends on what the workers value, and this can vary by generation. 21

The role of Distributed Work in Attracting and Retaining Talent

Attracting and Retaining Talent1The outcome of the need for work/life balance and a flexible work schedule is often distributed work. People are working anywhere, anytime—from the office to third spaces, and from their kids’ athletic events to the airport gate. Microsoft Canada suggests “employers who can offer flexible workspaces to their employees are leading the pack in becoming employers of choice”— especially for the younger generation. 22 Work/life balance is key for Millennials to remain satisfied on the job, and organizations that facilitate mobility programs will be a magnet for this generation. 23

Because technology has “broadened the playing field for finding talent globally, ” organizations will need to make distributed work a priority and find ways to enable collaboration, both virtually and face-to-face. 24 With people distributed across the globe, virtual teams are relying more on collaborative technologies.25

The emphasis on employee engagement as a foundation for innovation means companies will need to accommodate collaborative activities and foster a sense of community. Individual spaces will continue to shrink in both size and number. 26 Not just the Millennials, but also the elder generations have an increasing need for spaces that support teamwork. 27

Even the meaning of individual space has changed: Technology is “so pervasive that a workstation is anywhere networks can be accessed wirelessly.” 28 Hoteling and shared spaces provide ways to accommodate heads-down work when needed to save space and allow group spaces to expand. Telecommuting programs are simple solutions for organizations to incorporate flextime into their corporate culture. It not only saves space and reduces costs; it can also increase worker productivity up to 20 percent. 29

The role of Health & Well Being in Attracting and Retaining Talent

In today’s challenging economic times and volatile business world, there are elements in the workplace that are just as important—and sometimes more valuable—than adequate pay and benefits. Sodexo research reveals that a psychologically safe and healthy workplace is essential for companies focused on human and organizational performance. 30 When the workplace is used as a strategic tool, organizations can create places where people can work and live better. They can adapt the workspaces to fit the worker instead of the other way around—addressing the needs of individuals. 31 Simply providing naturally lit environments with access to daylight and views can help people be more productive than in workspaces with artificial lighting. Enhancing indoor air quality can also improve employee health and satisfaction levels.32

Personal control is another way to enhance physical comfort and health. People feel better about their jobs when they can claim some control and ownership in the work they do as well as in the place in which they do it—even if that means simply adjusting the furniture and other tools in the workspace to better suit their individual needs. Granting individuals some control over the appearance and organization of their work area can improve a person’s perception of his or her work and the actual experience doing it. Even small adjustments can satisfy personal preferences related to aesthetics, workstyles and comfort, increasing worker satisfaction. 33

Beyond Employee Retention: Engagement

Once organizations have attracted top talent, what’s the secret to retaining high-performing workers? One way is through employee engagement. “Higher levels of engagement can be a result of reward and talent programs adopted by employers that creatively seek a balance between responding to employee needs and coping with cost pressures. Employees’ desire to preserve their jobs may have also contributed to higher engagement levels demonstrated by a willingness to go the extra mile, be resilient and embrace change.” 34

The strong correlation between engagement and retention is well understood. “Intent to stay,” or an employee’s stated desire to remain with his or her current employer, is a strong predictor of actual turnover. It is also an indication of how strongly committed an employee is to the employer’s success. Globally, 60 percent of all employees report that, given the choice, they plan on remaining with their current organization for the next 12 months. However, this number jumps to 81 percent among engaged employees but drops to 23 percent among the disengaged. 35

Design Implications for Attracting and Retaining Talent

In a competitive race for talent, the workplace is a key component of the employment package organizations can offer. In fact, workplace effectiveness is “a strong factor in attraction and retention of talented people; ratings of a company’s attraction/retention capability are almost three times higher when workplace effectiveness rises above 80 percent.” 36 Companies with the highest WPI (workplace performance index) scores have close to perfect scores on valuing people, attracting/retaining talent and work/life balance. 37 It becomes a means for
fostering long-term loyalty when the workplace both supports and rewards workers’ efforts. 38 Here are some ways to consider designing the workplace to incorporate the values of CSR, work/life balance, distributed work and health/well-being.

TO ATTRACT PROSPECTIVE EMPLOYEES
• Express culture and brand—from colors and furniture—to reflect the attitudes and values of the organization.
• Offer the latest technology tools to support collaboration, flexibility and mobility.
• Create dedicated third spaces for employees to collaborate in a space away from the main campus.
• Assign workspaces even for mobile employees to help foster social networks and interaction.
• Design work environments to support the work—group spaces for collaboration and privacy for heads-down work that requires concentration. 39
• Create a comfortable, residential, fun environment that feels like home, with amenities such as kitchens, pantries, living rooms, and family rooms. 40
• Incorporate sustainable design when planning a new facility and include sustainable practices in existing or new
• workplaces.

TO RETAIN EMPLOYEES
• Nurture social networks through events such as celebrations.
• Build relationships by supporting impromptu interactions in community spaces such as cafés, and along deliberate pathways throughout the facility.
• Offer a variety of workspaces with mobile furniture to support collaboration, mentoring and meetings.
• Provide spaces for independent, heads-down work.
• Offer mobility and flexibility programs, and the technology tools employees need to support their work.
• Update or refresh spaces frequently to help employees feel valued. 41
• Integrate technology to create smooth transitions between work and home.
• Solicit feedback, address concerns and ask for employee input about how to improve the workplace.
• Encourage consumerization, especially among Millennials, offering consumer-friendly IT solutions rather than
corporate.
• Allow workers to use their own technology, such as iPads and smartphones, to do their work. 42
What people really want at work is a comfortable, functional place where they can be themselves. The more employees can identify with their workspace, the more content and motivated they are at their jobs. 43

Organizations need to make sure work environments align with corporate culture and values as well as brand. Then, by understanding the attitudes and workstyles of four generations—with a focus on the Millennial cohort—they’ll be able to accommodate workers’ needs. Flexibility is key in creating inspiring workspaces that attract top talent and retain workers through an engaging employee experience.

For More Information:

Steve Sable
Hayworth – Dealer Sales Manager
1700 Market Street – Suite 600
Philadelphia, PA 19103
c: 215.397.5656
o:215.977.8607
www.haworth.com

 

 

 

REFERENCES

1. CoreNet 2012
2. CoreNet 2012
3. CoreNet 2012
4. CoreNet The Leader 2013
5. Catalyst.org
6. Johnson Controls, 2012
7. Prensky, Marc, 2001
8. Johnson Controls, 2012
9. Johnson Controls, 2012
10. CoreNet 2012
11. Johnson Controls, 2012
12. CoreNet, The Leader, Mar/Apr 2012
13. Sodexo 2013
14. Sodexo 2013
15. Sodexo 2013
16. Colliers International 2011
17. M Moser Associates, 2008
18. Malcolm, Hadley, USA Today, 2013
19. SHRM 2012
20. SHRM 2012
21. Malcolm, Hadley, USA Today, 2013
22. Microsoft Canada
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WCRE First Quarter Report: Southern New Jersey Market Is Weathering Global Uncertainties

WCRE FIRST QUARTER REPORT: Southern New Jersey Market Is Weathering Global Uncertainties with Characteristic Strength

April 6, 2017 – Marlton, NJ – Commercial real estate brokerage WCRE reported in its latest quarterly analysis that despite political uncertainty at home and around the world, the Southern New Jersey market has started off 2017 on a cautiously optimistic footing.

“Even with an expected winter slowdown affecting office leasing activity, and added anxiety with the transfer of political power in Washington, the overall mood of the market seems to be positive,” said Jason Wolf, founder and managing principal of WCRE. “As we’ve seen the past couple of years, several business sectors increased their occupancy needs during the first quarter, and we continue to see increased capital spending, construction hiring, and expansions.”

There were approximately 317,886 square feet of new leases and renewals executed in the three counties surveyed (Burlington, Camden and Gloucester), which represents a decrease of approximately 18 percent compared with the previous quarter, but is essentially unchanged from the first quarter last year. While leasing slowed a bit, the sales market doubled in volume during the first quarter, with some 767,988 square feet worth more than $133.5 million trading hands. New leasing activity accounted for approximately half of all deals – a big increase over the fourth quarter. Overall, net absorption for the quarter was in the range of approximately 122,572 square feet.

Download The Report PDF>>>

Other office market highlights from the report:

Overall vacancy in the market is now approximately 11.05 percent, which is a nominal increase from the previous quarter.

Average rents for Class A & B product continue to show strong support in the range of $10.00-$14.50/sf NNN or $20.00-$24.50/sf gross for the deals completed during the quarter. This is essentially unchanged from the previous two quarters.

New Jersey’s unemployment rate moved down to 4.4 percent, putting it below the national rate of 4.7 percent.

WCRE has expanded into southeastern Pennsylvania, and the firm’s quarterly reports now include a section on transactions, rates, and news from Philadelphia and the suburbs. Highlights from the first quarter in Pennsylvania include:

Office demand in Center City is still exceptionally strong, as rental rates continue on an upswing and vacancy levels are compressing to all-time lows.

There is a significant amount of inventory of multi-family, including recently developed, under construction, and proposed, in both the City of Philadelphia and Philadelphia suburbs. Rental rates have either remained relatively stable or decreased slightly. Concessions are becoming commonplace at many apartment communities.

While much of the pricing for commercial real estate accounts for increasing interest rates, many purchasers are showing signs of hesitation and fears of potential decreases in market fundamentals.

The industrial market in the City of Philadelphia and its suburbs is fetching price points never experienced in the marketplace. The lack of available product coupled with significant demand is putting further upward pressure on overall pricing.

WCRE also reported on the Southern New Jersey retail market, noting an incongruous mix of consumers earning more and showing a willingness to spend, and a high number of retailers declaring bankruptcy. The report attributes this to a growing shift to online shopping and other changes in spending habits. Highlights from the retail section of the report include:

The Conference Board reports that consumer confidence is at its highest level since 2000.

Nine retailers filed bankruptcy in the first quarter, which is the same as the total for all of 2016.

Retail vacancy in Camden County stood at 6.4 percent, with average rents in the range of $12.92/sf NNN.

Retail vacancy in Burlington County stood at 11.1 percent, with average rents in the range of $12.31/sf NNN.

Retail vacancy in Gloucester County stood at 5 percent, with average rents in the range of $12.01sf NNN.

The full report is available upon request.

About WCRE

WCRE is a full-service commercial real estate brokerage and advisory firm specializing in office, retail, medical, industrial and investment properties in Southern New Jersey and the Philadelphia region. We provide a complete range of real estate services to commercial property owners, companies, banks, commercial loan servicers, and investors seeking the highest quality of service, proven expertise, and a total commitment to client-focused relationships. Through our intensive focus on our clients’ business goals, our commitment to the community, and our highly personal approach to client service, WCRE is creating a new culture and a higher standard. We go well beyond helping with property transactions and serve as a strategic partner invested in your long term growth and success.

Learn more about WCRE online at www.wolfcre.com, on Twitter & Instagram @WCRE1, and on Facebook at Wolf Commercial Real Estate, LLC. Visit our blog pages at www.southjerseyofficespace.com, www.southjerseyindustrialspace.com, www.southjerseymedicalspace.com, www.southjerseyretailspace.com, www.phillyofficespace.com, www.phillyindustrialspace.com, www.phillymedicalspace.com and www.phillyretailspace.com.

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