Space as a Service: Should offices operate like hotels?

Improvements in technology and greater access to flexible working means employees no longer need to work nine to five at the office. They are more readily able to work from home, in coffee shops and in more flexible environments. They are more able to choose where they work from at any one time than ever before.

To compete in this changing environment, the real estate industry should respond by operating its office spaces differently, and take its inspiration from those coffee shops, hotels and leisure destinations that are highly successful in pulling people in and keeping them there.

If space is increasingly a service, rather than a commodity, then offices must evolve to be more like hotels in the level of service that they provide.

Workers and tenants should be treated as ‘guests’ who can easily choose an alternative location to spend their time, meet and do business. Crucially, property operators must also attract new talent from the hospitality sector to meet the new expectations of occupiers and their staff. 

From the basics like quality coffee and a friendly reception team, to useful facilities such as dry cleaning, showers and bike storage on site, workers have come to expect a certain level of service from their place of work. They are now also embracing and driving demand for wellness initiatives like yoga and meditation.

Flexible office providers have successfully taken those popular office services to the next level. WeWork, for example, offers ‘craft on draft’ and ‘puppy therapy’ at its spaces to appeal to the employees of fast-growing SMEs and start-ups. 

There has been a boom in flexible and co-working providers in recent years, and many are now increasingly marketing themselves to corporate occupiers, competing with ‘traditional’ office buildings on long leases. Landlords are responding by launching their own co-working or flexible workspace offerings.

Tenants of all sizes want their staff to work from dynamic, exciting spaces where their employees feel welcome, productive, happy and healthy. Property managers must evolve their approach to help landlords meet these requirements, by focusing on people and service – not just bricks and mortar. They must deliver a high level of service and attentiveness, not just to tenants but to every person in the building.

Co-working companies such as Fora have been very successful in hiring from outside of the real estate industry, particularly from hospitality, to achieve this. Tellingly Hoxton Hotels also recently moved into the co-working space. The rest of the real estate industry needs to catch up and compete for talent in hospitality.

An excellent report from the BCO on the Skills Gap outlines the need to bring new people into the industry to deliver the customer experience demanded by today’s corporate occupiers.

At Knight Frank we have invested in people who provide a new perspective and unique skills that add new levels of service and value to the buildings and spaces we manage.

Kerry Campbell, our Client Services Director at Plantation Place, an over 500,000 sq ft building on Fenchurch Street, joined us from a career in hospitality including experience in running a hotel and country club. Anthony Watson, Director of Promise, Knight Frank’s facilities management business, also successfully ran two hotels before moving into property.

Our work with the Pollen Estate is also a good example of going well beyond the traditional property management brief. We recently welcomed Mary Elizabeth Rankin, as Marketing & Communications Director for the Pollen Estate, where she will help to promote the fantastic businesses and retailers on the estate. She brings a unique set of skills and experience from her time at Chicago Loop, the business improvement district for the City of Chicago, and that placemaking expertise will be of huge value to the estate.

Customer experience skills will be the biggest requirement for future real estate managers, and to win them over the property industry must be open and attractive to new talent from different fields.

An important part of that is demonstrating a commitment to service and new ways of working, that is centred around people rather than tenants, and that is more personal and less bureaucratic.

To achieve this real estate managers must offer a customer-centric, engaging and dynamic service to ensure offices are exciting, welcoming places, where workers choose to spend their time.  

Landlords and tenants expect their offices to be managed by dynamic teams with complementary skills and experience, and at Knight Frank, we are passionate about being at the cutting edge of their changing needs.