Only 12% of tenants browsing for office spaces are looking to downsize while 40% of respondents are ready to sign a lease, according to a CommercialCafe survey. Location and rent price — pre-pandemic favorites — are still the most important office space characteristics for tenants.
While online activity pointed toward a rebound in the commercial real estate sector, CommercialCafe wanted to get a clearer picture of what was driving tenants to look for office spaces. So, CommercialCafe asked visitors to its website and PropertyShark to answer five questions related to their current office space situation and expectations.
Here are other findings from CommercialCafe report:
- When asked about their current lease situation, 47% of respondents said they were only browsing for properties and postponing any leases for the time being, whereas 40% were actively looking for an office property to lease. The remaining 13% said they were looking for an office space, but avoided booking viewings.
- Those who were actively browsing for an office space, 24% said they were simply looking to relocate, while another 24% were looking to upscale their office space. Notably, only 12% of respondents said they were downsizing and looking for a smaller office space.
- When it comes to the characteristics of their future office space, preferences did not change considerably form before the pandemic. When asked to choose the three characteristics that matter the most in their choice, and two responses — location and rental rate, which were leading factors for choice in office space prior to the pandemic — far outpaced the rest. Tenants also expressed confidence in the stability of the market, as only 6% viewed rent deferral clauses as an important factor in signing an office lease.
- Expected amenities (in which respondents could choose any number of responses) also did not change considerably since the pandemic was declared. Namely, parking space and natural light are still the most sought after, with 39% and 32% of responses, respectively. Moreover, 23% of respondents said they are not expecting any change in terms of amenities.
- Some tenants are showing more interest in additional health and safety measures, even if they are lower on the list of priorities. For example, 16% of respondents expected to have improved HVAC and antimicrobial furniture, while 11% were looking for buildings with multiple entrances to reduce crowding.
- Of all survey respondents, 35% said they were searching for office space in a building smaller than 50,000 square feet, and 25% wanted to lease space in a suburban location. In fact, some real estate experts have pointed toward lower-density suburban offices as a possible solution for companies’ operations — at least for the time being.
Methodology: The data presented in the survey was collected between July 27, 2020 and October 1, 2020 on CommercialCafe and PropertyShark, with a total of 1,882 respondents from the U.S. Responses were voluntary, and respondents could stop at any point in the survey. Google Trends data was collected between October 19, 2019 and October 20, 2020.