The Dynamics of Office Leasing in the Age of WeWork
In the business world, workplaces are taking on ever greater importance to not only the bottom line but the strategic direction of a company. Business leaders are realizing that an office lease could literally make or break their company.
This has landlords feeling the squeeze in this changing environment. As the business of real estate transitions from the wholesaling to the retailing of office space, value is being generated by meeting the needs of customers. Frankly, most property owners realize that they don’t know much about the tenants in their buildings, and are ill-equipped to provide flexibility and deliver amenities that tenants are looking for. In fact, the notion of what is considered prime real estate is changing and landlords are scrambling to catch up.
To better understand the current dynamics of office leasing, we engaged in a deep-dive into the topic by going over the available research, a variety of data sources, and exclusive interviews with industry leaders throughout the property industry. This report offers a comprehensive guide to help decision makers understand how office leasing has changed, the underlying factors driving this change and the emerging technologies that are enabling it.
In this report we have identified four factors that are major contributors to the change in the office leasing environment: technology, macroeconomics, demographics and something that we are calling the “agile transformation.” First we will outline each in terms of their effect on leasing demand. Next we look at new technologies and trends that are shaping the leasing process for tenants, landlords and brokers. Finally, we analyze the effect space-as-a-service and new lease accounting rules are having on the traditional leasing market.