Western Real Estate Business

AUG 2018

Western Real Estate Business magazine covers the multifamily, retail, office, healthcare, industrial and hospitality sectors in the Western United States.

Issue link: https://westernrealestatebusiness.epubxp.com/i/1012778

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28 • August 2018 • Western Real Estate Business www.REBusinessOnline.com must also work with operators to provide pro- tection for the increasingly valuable logistics technology and quantum of goods that are housed in industrial facilities. A Look to the Future of Property Management Property managers must continue to keep pace not only with ever-changing market con- ditions, but with the rapid evolution of tech- nology to successfully serve their two primary stakeholders — tenants and investors. "As the future of property management con- tinues to evolve, our tech-enabled experience services, CBRE 360, will play a crucial role in establishing a more connected and enhanced workplace experience for tenants and their em- ployees," says Mary Jo Eaton, CBRE global pres- ident of asset services. Convenience and flexibility will remain key factors as technologies take hold. With plat- forms like CBRE 360, you can book a yoga class, order coffee, and send a note about a slippery floor to property management in a matter of minutes. The options are limitless. Butcher believes the core office structure will continue to be of concern for our San Diego in- vestor clients and occupiers. "Transforming what we traditionally referred to as an office into what we now see as a work- place shifts the layout's purpose to technology, flexibility, wellness and social amenities," he notes. Regardless of location or property type, CBRE believes the focus should remain on the contin- ual improvement of response time for tenants' needs and creating destinations of choice for our investor clients by integrating property ser- vices and amenities with digital technologies. Robert Peddicord, Executive Managing Director for Asset Services in the Western Region, CBRE P roperty management plays a key role in office, industrial and retail deci- sions in Southern California and around the world, according to the findings of our inaugural CBRE 2018 Global Tenant Sur- vey. For the survey, CBRE polled more than 1,300 users of com- mercial real estate worldwide to determine which aspects of property management tenants value most and the types of new services they de- sire. In this article, we focus on how the findings re- veal a distinct connection between the value prop- erty management brings to an asset, its tenants and the evolving role of a property manager. Property Management Delivers Value to Owners, Investors The respondents focused on the need for core property management services to be performed in a timely manner with a focus on tenant needs. By doing so, property managers will not only en- hance the overall tenant experience, but improve tenant recruiting, lease renewal and, ultimately, the value of the property. Across all property types surveyed, 88 percent of tenants say the quality of property manage- ment has a strong or very strong impact on the decision to renew their lease. For tenants, renew- ing a lease at an existing location means greater workplace stability and less cost and disruption resulting from relocation. For investors, higher renewal rates mean longer lease terms and high- er overall net operating income. Improving the net operating income of a building by just 10 ba- sis points (bps) makes a difference to returns in today's low cap-rate environment. "In San Diego, we are seeing investors and ten- ants becoming more focused on property man- agement and its importance to their company's bottom line," says Mark Butcher, our managing director from San Diego. "In our region, we find that quality property management enhances the overall tenant experience, improves tenant re- cruiting and increases the likelihood of tenant lease renewals, which drives competitive returns for investors." Providing a Destination of Choice As employers strive to create a healthier, more collaborative and productive work environment for employees, the quality of property manage- ment and the incorporation of technology are critical considerations when making location decisions. In fact, 87 percent of respondents said good building management plays an important or very important role in employee retention. When asked to define what constitutes good building management services, the core func- tions of effective property management — en- suring building operations run smoothly and are financially efficient — remain of vital impor- tance. TIMELINESS, RELEVANCE ARE TOP GOALS FOR PROPERTY MANAGEMENT INITIATIVES Technology has brought about the need for real-time responses and instant solutions, according to CBRE's latest survey. By Robert Peddicord Peddicord CBRE was recently awarded the property manage- ment assignment at the Bloc in Los Angeles, the city's largest mixed-use development. The development has 420,000 square feet of open-air, urban retail space, 722,000 square feet of office and a 496-room Sheraton Grand hotel. We shared in the ownership's vision of creating a hospitality component that will work in sync across these assets, while also providing a great destina- tion for local workers and Downtown residents. With our technology-enabled processes and programs, we are excited to spearhead the efforts of enhancing the func- tionality while bringing tremendous value and exper- tise to this world-class project. Amenities Valued Most by Tenants Vary by Property Type There are many ways property managers can enhance the user experience of buildings. Overall, the key ame- nity is parking for all property sectors, according to re- spondents. Transforming what we traditionally referred to as an office into what we now see as a workplace shifts the layout's purpose to technology, flexibility, wellness and social amenities. Conference centers and wellness facili- ties are at the top of the list, including fitness centers, cafeterias and coffee bars. Retail tenants are focused on services that enhance the profile of the shopping destination among shoppers. They are also interested in consumer analytics and more precise demographic information about shoppers. Within the industrial sector, property managers must keep up with the changes that are taking place. They

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