Discover the secret for how to keep tenants happy
Learn how tenant experience trends can be your biggest differentiator in our 2021 Outlook.
The Office Guide for How to Keep Tenants Happy
When thinking about a typical commercial real estate tenant, many overlook the small details of their day. From their morning commute coffee to post-work activities such as doctor’s appointments or fitness classes, tenant activities are more ingrained in your building community than you may think and have a huge impact on how to keep tenants happy. Even actions outside of your building are all part of what makes a good tenant experience, also known as “TeX.”
Cultivating this ecosystem is critical. Each tenant activity presents a new opportunity to improve the property experience with technology and experiences tailored to the individuals who are in the building every day. These opportunities harness the power of tenant experience: helping landlords put relevant technology into the hands of a building’s population that they don’t regularly connect with, and using that technology to improve tenant retention and attraction and to add value to their assets.
How to Keep Good Tenants
When it comes to figuring out how to be a good landlord in order to attract and retain office tenants, one first must look at the most recent changes to the commercial real estate market (CRE). Due to long-lasting effects of the COVID-19 pandemic, the CRE value equation has shifted away from the buildings themselves to the people who occupy them. With the assistance of tenant experience technologies, property leaders and teams can seize an opportunity to adopt a consumer-first model and embrace the most recent digital disruptions. By blending the physical and digital workplaces, they can also create engaging and memorable experiences that differentiate their portfolios and tune into their most important assets: their tenants.
Hybrid work models have seen massive growth in order to follow mandatory health and safety protocols. This necessary flexibility in working preferences also means that the workplace and its community have now officially transcended the four walls of the office building — not only do landlords have to find ways to create great experiences for those who choose to come into the office, but also for those who choose to stay at home or work from some other remote location.
Thus, the industry has reached a point where improvements to the physical office environment can no longer enhance the tenant experience on their own — rather, technology is needed to bridge the gap between the physical office and the digital workplace, while also connecting dispersed employees in a way that is both engaging and thoughtful. This means that good landlord qualities include providing omnichannel office experiences.
Omnichannel office experiences are exactly that: integrated experiences that provide your building occupants with seamless transitions between digital and physical offerings. Signs of a good tenant experience include everything from plugging into your building’s various technology systems to ensure that the building occupant journey is tech-enabled, to increasing your digital programming through virtual amenities that all can partake in, no matter where they are. These strategies will not only address how to reward good tenants but also align with the needs of a modern workforce when screening tenants who are interested in joining your building community.
What Makes a Good Tenant Experience
In order to keep up with the rise of tenant experience and to achieve omnichannel office experiences, you will need to start looking into — at the very minimum — an office app for tenant engagement. A tenant engagement app will not only ease modern-day concerns revolving around safety, communication, and engagement for your existing tenants, but it will also help you strengthen your workplace culture to help attract new tenants.
On a similar note, a large focus area of what makes a good tenant experience is the concept of flight to quality or digitizing one’s building amenities. A 2019 Cushman & Wakefield study revealed that before the COVID-19 pandemic, highly amenitized buildings had an 18.3% rent premium compared to the surrounding submarket. This premium proved even more substantial at 21.6% in the central business districts (CBDs) of gateway markets. Amenities still play a role in overall office culture, and the concept of flight to quality — or digitally enhancing your building’s offerings — can prove to be a major differentiator for your portfolio. This also lends credence to the positive impact that technology can have on cap rates when focused on engaging people and strengthening connections.
Offering digital programming to complement your assets can re-shape antiquated engagement models by bringing your building’s amenities directly to the end-user, as opposed to having tenants seek them out on their own. One of the many signs of a good tenant experience, this establishes a brand value that extends beyond the office — both of which are especially valuable now since many tenants and employees are not physically in the building.
For many HqO clients, “going digital” has already led to unique and desirable workplace experiences for both current and prospective tenants. Each client has the power to customize in-app features to fit their specific needs, creating solutions that highlight their building’s individual communities and personalities. These solutions have spanned from offering virtual fitness classes and hosting building-wide events, to gift raffles that show tenant appreciation, to mobile ordering services that cut down on traffic and congestion in public common areas associated with popular on-site food and retail vendors. Remember: what you do with your tenants now will create memorable, lasting impressions moving forward.
How to Maintain Property of the Future
Keeping tenants happy goes beyond tenant engagement, as every member of the building community — from property managers to facilities staff to even on-site retailers — can impact the tenant experience. Similar technology solutions that can be leveraged to automate building processes and create memorable end-user experiences can also be used to maintain property needs of the future.
The role of a property manager used to be focused on solely building management (security/safety, utilities/energy, reception, and building certifications) and property-level administration (rent collection, ensuring compliance with lease terms, and CapEx administration). Now, property management teams are being asked to play a significant role in tenant retention. Essentially, in order to generate value for building tenants and investors, they focus on all the aspects of a traditional property management model, as well as communication (with vendors, maintenance staff, and tenants), amenity management (parking, catering, food/beverage, transportation), services management (concierge, networking, programming, health and fitness), and technology services (apps, internet connection, data collection, content generation).
These combined efforts have a huge impact on the performance of an asset. For example, according to CBRE data, 88% of tenants say that the quality of property management has a strong to very strong impact on their decision to renew a lease. Additionally, 87% of tenants say that good building management plays an important or very important role in employee retention. Increasing this customer retention by just 5% alone can increase overall profits by 25 to 95%.
In today’s world, when it comes to what to look for in a property management company, tenants will want to work with someone who can combine the more traditional property management duties and responsibilities with those that are customer-centric and tech-enabled. This includes everything from desktop property management software to mobile, cloud-based property management software. Though the modern role of a property manager is certainly challenging, it can produce great value and ensure the success of modern commercial real estate portfolios.
Landlord Best Practices
Keeping tenants happy also involves adopting a data-driven approach. With the industry’s transition to a more consumer-first model, there is no standard “How to Be a Good Landlord” book. Instead, we know the greatest source of information comes from what property owners can’t see about their buildings. What do tenants really want, and how do they really use a given space?
If you’re actively collecting data from multiple sources about the needs of your tenants and their employees, you’ll be able to keep pace with the market and adapt to significant disruptors in your industry — even if that disruptor happens to be a global pandemic — while simultaneously making your workplace more attractive to its communities.
So, how exactly can you collect these insights?
Property owners now need access to multiple granular data points across their buildings to bring themselves closer to their end-users than ever before. Fortunately, the HqO platform includes a robust tool that can analyze multiple human behaviors throughout any asset, then help determine what the data can tell owners and tenants about employee needs. Owners can then compare these insights to other similar and nearby buildings, helping inform decisions that previously had to be made with little or no data. While these capabilities may only sound like something from the future, through the HqOS Digital Grid™ they are now entirely possible.
This type of engagement establishes what we refer to as a virtuous feedback loop. Having such significant intelligence on the end-user of your product helps create a better user experience, which in turn increases customer engagement and continues to provide you with more useful data. What makes a good landlord is real-time feedback, which ensures the longevity of office buildings by giving market leaders the informed, competitive edge they need to make turnkey decisions and guarantee tenant satisfaction.
To learn more about how tenant experience and property maintenance technologies can attract and retain tenants, schedule a free HqOS demo today.
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The pandemic has dramatically changed where, when, and how people work. Your properties need to be more than just a space, but a community that offers real value to the workforce. HqO helps landlords enhance physical spaces with digital experiences and provides the data they need to make informed decisions about their buildings.
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HqOS — the tenant experience operating system for commercial office buildings — enhances physical spaces with digital experiences, accelerates the implementation of innovative asset strategies, and enables data-driven decision making
- Create rich digital experiences for the people who occupy your buildings with the Tenant Experience Platform
- Find and manage apps in one place with the Marketplace
- Capture & structure all data on how people use your buildings with the Digital Grid™
- Deploy your tenant experience strategy with Headquarters