The State of Commercial Real Estate in 2021
COVID-19 has accelerated change in consumer and organizational behavior at an unprecedented rate. Companies have adopted remote ways of working with open arms because it was a decision between that and shutting down the doors.
While this has been a boon for certain tech companies, it has made the business environment extremely uncertain for others. In the case of commercial real estate companies, their tenants may not return to the old way of working and their real estate needs will shrink for the foreseeable future.
There are always winners in any situation. It requires seeing the trends and taking action proactively rather than reacting to changes after the fact. Retail is a prime example where the biggest brands, who were dismissive of the rise in ecommerce, have double-downed on their own digital retail endeavors.
For commercial real estate, the news of CBRE acquiring a 35% stake in the flexible workspace provider Industrious is of importance.
The demand for flexible workplaces has grown already and will continue to do so while traditional landlords enter this space. Anyone who can move quickly to capitalize on this trend would be a in better position to serve the tenants’ changing needs.
As long as work patterns remain up in the air, the kind of service the likes of IWG provides may be more in demand. Few companies will be in a rush to sign a 10-year lease until they understand how employees will divide their time between home and the office in future. Some may turn to looser office arrangements longer term, accelerating a trend already building before the pandemic. Real-estate analytics firm Green Street estimates that flexible leases will grow from around 2% of total U.S. office space today to one-tenth by the end of the decade.
What does my mailroom have to do with this?
How important is your mailroom to your own operations & your tenants’ experience?
A lot of functions in a building or an organization are like a kicker in football. You'd remember them for when they failed and not for the 99.99% of the time when they performed perfectly well.
Your mailroom is similar. People take for granted how well it runs its service until it stops working.
Current mailrooms are stressed to their limits, as their processes & systems weren’t built to handle modern-day mail and package volume. Because of the increase in volume, storage capacity issues and lost packages are riddling mailrooms across the nation. And not only are lost packages troublesome in their own right, but, in some instances, they lead to a loss of productivity because they contain key material needed to conduct one’s day-to-day.
Think of a modern office that has been set up in your building. With a 50% capacity allowance, they have 50% of their workforce working remotely and, while they have access to their digital assets, cannot access mail & packages that are still being routed to their business address.
- Here is where you have to ask yourself some questions:
- Is your mailroom equipped to store unpicked packages? If so, for how long and at what cost?
- Is your mailroom ready to manage the additional complexity of flexible working spaces and a transient tenant population?
What Should Be My Next Steps?
In a highly competitive space where customer experience and reducing costs will be major decision factors such as providing a more white glove mail and delivery service and saving manhours through quicker processing, real estate companies have to quickly decide their path forward and make sure that they are, in every sense, ready to deliver a delightful experience to tenants.
Max Handler, former Global Head of Business Operations, shares the problems that he had to solve at WeWork as their package volume grew with COVID-19. His overall takeaway: these problems can & should be addressed proactively.
If you’d like to book a free 30-minute consultation with one of our advisors to determine how you can be better prepared to handle increasing tenant mail and package volumes, please click here .