2022 | 3RD EDITION
FORESIGHT ANNUAL COLUMBUS OFFICE TENANT REPORT PRESENTED BY COLLIERS | COLUMBUS
TENANT BEHAVIOR AFFECTING THE OFFICE MARKET - p. 6 WHERE ARE BUSINESSES RELOCATING? - p. 12 TOP WORKPLACE TRENDS - p. 18 WHAT CAN WE EXPECT IN 2022? - p. 23
2022 TENANT REPORT
1
OUR PURPOSE At Colliers | Columbus, we help to accelerate our clients’ success, specializing in industrial, office, retail, multifamily and investment properties. Services provided within these specialties include leasing, disposition, tenant and buyer representation, corporate services, property management, facility services, construction management, development, valuation and consultation, in order to add value to our clients’ assets.
2
2022 TENANT REPORT
table of contents
WHAT’S INSIDE?
2022
prediction
Look for this icon throughout for insight on 2022 predictions.
06
Tenant Behavior & Case Studies
10
Interview: From the Market Experts
12
Tenant Migration: Where Are Businesses Relocating?
18
Top Workplace Trends in 2022
20
Interview: Tenant Insights with MentorcliQ
The world continues to feel the effects of the ongoing What’s to Come? What Can We COVID-19 pandemic, which has altered day-to day life Expect in 2022? and impacted society, the economy and commercial real estate over the past 18 months. With negative absorption, added sublease availability and rising vacancies, the Columbus office market is facing a tremendous challenge. There has been some uncertainty regarding the future of physical office space, but the sector is showing signs of recovery. This report will explore workplace trends, case studies in tenant behavior, migration patterns, interviews with industry leaders and predictions for 2022 – all relating to the Columbus office market.
23
2022 TENANT REPORT
3
ABOUT THE AUTHORS Reach out to our research team with any questions, or for the inside scoop! Hannah Williams: +1 614 410 5179 or hannah.williams@colliers.com Hannah Williams CPRC Senior Research Coordinator A native of Columbus, Hannah grew up in Clintonville before attending Ohio State. As an ambassador for all things Columbus, she is passionate about being part of the city’s growth and development. Hannah provides research support for the Brokerage, Property Management, Facility Services and Construction teams, as well as the Director of Marketing & Research at Colliers | Columbus.
Paul Krimm CSM MBA Managing Director | Principal With more than 20 years in the industry, Paul serves as the Managing Director for the Columbus operation of Colliers, where he is responsible for driving recruitment, new business development, spearheading operational success and efficiencies and developing training and best practices across all service lines.
Richard B. Schuen CCIM SIOR CEO | Principal Rich Schuen, Colliers | Columbus founder and CEO, came to Columbus, Ohio over 30 years ago with a dream and a passion for real estate. Turning what he loves into his livelihood truly allows him to ‘live the dream’ and share it with his team members and clients.
Briana Sfero CPMC Marketing Project Manager Briana is a graduate of The Ohio State University with a passion for communicating the Columbus story with a fresh take that truly spotlights her adopted hometown. She currently provides support for the Office Services Group, as well as the Columbus office.
Danielle Chisling Marketing Specialist A graduate of Indiana University, Danielle brings a new and innovative vision to the team, creating inspiring and original ways to showcase her new city. She currently provides support for the Investment Services Group, as well as the Columbus office.
4
2022 TENANT REPORT
As larger firms begin to return to work, I believe velocity will gradually improve and deal terms will slowly return to pre-pandemic levels. - Paul Krimm CSM, MBA Managing Director, Colliers | Columbus
2022 TENANT REPORT
5
TENANT BEHAVIOR CASE STUDIES
&
“
People are excited to get back to the office. Folks have renewed optimism and renewed energy.
6
2022 TENANT REPORT
“
- Alison Beer JPMorgan Chase Columbus Business First
The Trend: return of large companies For nearly the past two years, the COVID-19 pandemic has impacted the way we live and work. The future of traditional office space has been questioned, especially with many large companies postponing their re-entry dates as cases grow and variants arise. However, multiple prominent companies in Central Ohio have been vocal about their workforces coming back to the office and the importance of their physical office spaces. Below are a few examples of large organizations that are returning to the office.
Case Study #1:
JPMORGAN CHASE JPMorgan Chase has been vocal in their stance to bring their nearly 15,000 employees back to the office. Already enforcing staff to be in-person five days a week in New York, the bank is planning to do the same in other markets. In 2021, the company made the decision to give up their 40,000 square feet at 100 E Broad St. to consolidate at their other offices and better facilitate their staff’s return to the office. According to The Wall Street Journal, representatives at JPMorgan Chase expressed that their teams are more collaborative and innovative in the office and less productive when working remotely. To ensure safety in the workplace, the company is currently requiring twice-weekly COVID testing for unvaccinated employees.
ADDRESS
1111 Polaris Pkwy. 3415 Vision Dr. 800 Brooksedge Blvd.
Case Study #2:
SIZE
2.9M SF
CURRENT # OF EMPLOYEES 15,000 in Central Ohio.
UPSTART
Since establishing their second headquarters in Columbus in 2019, Upstart has grown rapidly. Starting out in coworking space with 13 employees, the e-lender now has two office spaces and over 500 employees in Central Ohio. In the midst of the pandemic, Upstart signed a lease, the largest of 2021, for an entire building at Easton with the goal of bringing employees back to the office. This property used to house Alliance Data’s offices, prior to the company opting for remote working for most of their employees. However, Upstart believes their space is conducive to the additional 500 jobs that the company plans to create in coming years and is committed to utilizing the space for customer-facing operations such as underwriting.
ADDRESS
711 N High St. 3075 Loyalty Cir.
SIZE
295,000 SF
Sources: Columbus Business First, Wall Street Journal, CoStar, JPMorgan Chase, Upstart
CURRENT # OF EMPLOYEES 500 in Central Ohio.
2022 TENANT REPORT
7
The Trend: FUTURE OF CALL CENTERS The future of call centers is another hot topic that is majorly affecting the office sector. With many office employees forced to work remotely since the beginning of the COVID-19 pandemic, many employers have realized that their team members can adequately do their jobs from anywhere. There is a now a question of whether call center employees should move to become fully remote, or if it is important for them to be in the office, interacting with their peers. Below are a few examples of companies that have responded to this question in different ways.
Case Study #1:
BMW FINANCIAL One company that is solid in their plan to have employees, including call center representatives, in the office is BMW Financial. The company signed a lease in June of 2021 for the entire first phase of Grandview Crossing, relocating from 5550 Britton Pkwy. in Hilliard. Their workforce is expected to grow to as many as 900 jobs in this new space, and about 65% of the building will be dedicated to call center space specifically. Despite one viewpoint that having call center agents work remotely is more cost-effective, BMW Financial’s plan suggests that the collaboration created from in-person interactions is well worth it.
ADDRESS
1400 City View Dr.
Case Study #2:
SIZE
122,000 SF
CURRENT # OF EMPLOYEES 562 in Central Ohio.
DISCOVER
Discover Financial Services is an example of a company that is taking the opposite route and opting for more remote work for their call center employees. They announced in 2021 that they would be selling their office building at 6500 New Albany Road. The 333,000-square-foot property in New Albany is still on the market. Discover has explained that they are exploring options in hybrid working for their employees, and if need be, will lease back a portion of the space at this building. They have expressed a long-term commitment to a number of their call center employees working remotely, which will shrink their overall real estate footprint in the Columbus area.
ADDRESS
6500 New Albany Rd.
8
2022 TENANT REPORT
SIZE
333,169 SF
CURRENT # OF EMPLOYEES 2,283 in Central Ohio.
Sources: Columbus Business First, Wall Street Journal, CoStar, BMW Financial, Discover
WHAT’S IN STORE FOR 2022?
“
The decision to relocate our office comes from several different key factors including the need for a state-of-theart facility that better supports collaboration and provides more flexibility in the way our associates work and interact throughout the day.
“
- BMW Financial Columbus Business First
2022
prediction
MAJOR TENANTS IN 2022 At the time of this publication, there are over 30 tenants in the market requiring 25,000 square feet or more. Over half of these large users are business services, healthcare and financial services companies, so we predict these industries to drive activity in 2022. Prominent tenants such as Surge Force, Vertiv and Industrious are searching for space and are expected to make big moves this year. Bob Evans, Alcyone and Dish Network are all looking for over 30,000 square feet of space in New Albany, East and Hilliard, respectively, so we foresee that multiple large leases will be signed in suburban submarkets this year. Additionally, due to BBI Logistics, Expansive and an undisclosed user’s plan to purchase office properties, we predict that sales activity will pick up throughout 2022. 2022 TENANT REPORT
9
From The Market Experts
Pictured from left to right; Jake Nolan, Ross Lanford and Grant Hartman.
Ross Lanford, Grant Hartman and Jake Nolan (pictured here) are a full-service leasing and sales team at Colliers | Columbus. In the past five years, they’ve been involved with over 140 transactions valued at over $232 million, accounting for the lease and sale of over 2.7 million square feet. Their specialization in the office market provides them with expertise on tenant behavior and current trends. Compared to last year, are you noticing a shift in where tenants are looking for space and how they are designing their spaces? Yes – I have noticed that there seems to be a flight to quality as employers take a much closer look at their layout and how their space needs to function as a whole. Many tenants have given much more thought to creating a work environment that employees will want to work in. Some of these changes include more open, collaborative areas, including soft seating/drop in areas for employees that may be on flex schedules. Our team has had success in turning downsize conversations into space reconfiguration conversations. This typically requires a team effort with the tenant, furniture company, architect and landlord in order to be effective. -GH 10
2022 TENANT REPORT
New mixed-use developments continue to lead activity in the office sector. What are other landlords doing to compete with these properties? There is no way for existing stand-alone offices to compete with new mixed - use developments. The mixed-use development office space is demanding a 35% premium over existing product, so if a tenant is willing to pay the additional rent, there’s very little landlords of existing buildings can do to compete. The real competition is between like-kind existing product, forcing landlords to renovate /update their common areas and add amenities in order win deals in this market. -RL
2022
prediction
Do you think we will see a major shift to permanent remote working, or do you anticipate employers bringing employees back to the office? I don’t think we’ll see a major shift to permanent remote working long term. However, I believe some companies will need to continue to offer the option to retain some of their employees. Companies will evaluate which branches of the business need to be in the office and which ones are able to perform at home, allowing them to restructure their footprint for physical office space. However, two things that challenge the idea of permanent remote working are recruiting new talent and training that talent. It’s extremely hard to grow a company over Zoom or transfer values that your business has been built on. In these cases, we see groups looking to improve their space through finishes and design to bring people back into the office. Over time companies will figure out what works best for their business, but I predict momentum for employees being back in the office, whether that’s a full work week or a few days per week. -JN
From your experience, how has COVID affected different industries as it relates to tenant demand and behavior? I am noticing that call center/customer service type users and space have been hit the hardest. These were previously tenants that would take large chunks of space that required little buildout, which was attractive to owners. With that being said, we can all agree that the cube world layout that went to the wayside during COVID was something that has been many years in the making, and COVID simply accelerated that process. Overall, I believe that productivity long term for call center/sales/ customer service type employees will diminish. Third party productivity management is also very expensive and not feasible for mid-tier employers long term. Eliminating physical space for the call center aspect of a company was an easy choice for companies in the short term but I strongly believe we will see this use re-enter the market in the next 18 months. -GH
What do you predict will be the next big trend in space design for office users? I believe the biggest trend going forward in space design will derive from flexibility and community. These two factors will work to maximize talent retention, recruit new talent and excite employees to want to work in the office. With some companies going to a flexible work schedule, office design will be a priority when looking for new space or upgrading their current location. Instead of a focus on private offices, you’ll see companies working to maximize open space. These spaces could include work zones with modular furniture or smaller meeting areas that a team could utilize. Each area can be geared toward what your employee or team is trying to accomplish, ultimately increasing productivity while they’re in the office. This is a shift in thinking, as previously companies would look at a space in terms of number of desks or offices. This flexibility will allow companies to adapt easily to changes in the number of employees who will be in the office throughout the week. Businesses will also be more focused on amenities, whether those are present in their physical space or in the building. These community factors will promote working in the office, while offering focused productivity and socialization. -JN Are you noticing any trends relating to term or Tenant Improvement (TI) allowance? Tenant improvement is a big variable right now. Construction costs are up approximately 25% year-over-year, and tenants are looking for shorter term leases. This has delayed deals from moving forward and has also forced as is short-term extensions until the tenants are willing to commit to more term. Landlords are willing to provide more TI if a tenant is willing to commit to a long term deal, but those deals are hard to come by at this point. -RL
TENANT MIGRATION Where are Businesses Relocating?
Tenants are consistently relocating their office space to better fit their needs. By using a points system based on signed square feet, we are able to track where office users are coming and going throughout the city. We also analyzed each of these transactions in detail to compile statistics, identify trends and make predictions for future tenant behavior. Keep reading to find out more information on tenant migration in the Columbus office market.
Lease Length: 2020
There was a dip in Q2 2021 in the number of leases signed, but activity picked up in the latter half of the year. There was no real trend in tenant improvement (TI) allowance per quarter, but average term length did slightly increase over the year.
2020 Total:
Leases Signed - 162 Signed SF - 1,177,245 SF Average TI - $22.86 Average Term - 61 months
12
2022 TENANT REPORT
2021 Total:
Leases Signed - 231 Signed SF - 1,649,893 SF Average TI - $23.94 Average Term - 53 months
Government, Real Estate/Construction and Technology replaced Law, Non-profit and Logistics from 2020.
Highest Average Term Length (in months) by Submarket: 55
56
70
months
months
months
Polaris
Leases Signed - 61 Signed SF - 421,596 SF Average TI - $21.18 Average Term - 56 months
62
months
East
Q4
Leases Signed - 69 Signed SF - 561,214 SF Average TI - $19.76 Average Term - 54 months
60
months
Central Business District (CBD)
Leases Signed - 43 Signed SF - 438,373 SF Average TI - $20.15 Average Term - 59 months
Q3
Leases Signed - 45 Signed SF - 358,588 SF Average TI - $35.89 Average Term - 50 months
60
months
Government
Leases Signed - 21 Signed SF - 90,791 SF Average TI - $25.69 Average Term - 56 months
Q2
Leases Signed - 56 Signed SF - 308,495 SF Average TI - $23.85 Average Term - 51 months
Real Estate/ Construction
Leases Signed - 20 Signed SF - 103,415 SF Average TI - $30.07 Average Term - 63 months
Q1
Highest Average Term Length (in months) by Industry:
Technology
Leases Signed - 78 Signed SF - 544,666 SF Average TI - $20.93 Average Term - 63 months
2021
Polaris remained in top 3, while East and CBD replaced Easton and Arlington/Grandview from 2020.
The number of leases signed and the total square feet signed increased considerably. Average TI allowances have increased, while average term length has decreased postCOVID.
TI Allowance*: Highest Average TI Allowance by Industry: Law
$36.41
Financial Services
$32.70
Real Estate/ Construction
$31.89
Law remained in top 3, Financial Services and Real Estate/Construction replaced Healthcare and Business Services from 2020.
Highest Average TI Allowance by Submarket: CBD
$39.91
Polaris
$37.93
Arlington/ Grandview
$32.85
Polaris and CBD remained in top 3, Arlington/Grandview replaced Easton from 2020. * The TI (tenant improvement) allowance is the amount that the landlord will spend for the tenant to build out their space.
Leased Square Feet: Highest Total SF Signed by Industry:
Financial Services 606,885 SF
Healthcare 191,860 SF
Law 149,823 SF
Financial Services remained in top 3, Healthcare and Law replaced Technology and Business Services from 2020.
Highest Total SF Signed by Submarket:
CBD 402,645 SF
Easton 335,025 SF
Arlington/ Grandview 253,755 SF
CBD remained in top 3, Easton and Arlington/Grandview replaced Dublin and New Albany from 2020.
TENANT MIGRATION HEAT MAP Represents the number of tenants that were new to the submarket
Dublin | 40 points 34 tenants (176,442 SF) 8 tenants (40,650 SF) 5 tenants (22,444 SF)
Easton | 22 points 9 tenants (315,987 SF) 1 tenant (19,038 SF) 1 tenant (1,824 SF)
Polaris | 14 points 11 tenants (45,260 SF) 1 tenant (4,686 SF) 0 tenants (0 SF)
Southeast | -1 point 2 tenants (2,826 SF) 0 tenants (0 SF) 2 tenants (7,168 SF)
Gahanna/Airport | -2 points 7 tenants (42,932 SF) 2 tenants (3,893 SF) 9 tenants (46,021 SF)
Represents the number of tenants that moved within the submarket
CBD | 24 points 24 tenants (196,919 SF) 24 tenants (205,735 SF) 16 tenants (65,894 SF)
Worthington | 20 points 25 tenants (75,460 SF) 9 tenants (33,212 SF) 7 tenants (30,987 SF)
Arlington/Grandview | 7 points 11 tenants (181,694 SF) 7 tenants (72,061 SF) 12 tenants (39,160 SF)
North Central | -1 point 3 tenants (7,882 SF) 0 tenants (0 SF) 3 tenants (11,423 SF)
New Albany | -3 points 3 tenants (12,588 SF) 0 tenants (0 SF) 3 tenants (34,454 SF)
Hilliard | -5 points 2 tenants (8,800 SF) 0 tenants (0 SF) 3 tenants (130,689 SF)
14
2022 TENANT REPORT
Represents the number of tenants that left the submarket
Westerville | 24 points 21 tenants (81,488 SF) 5 tenants (13,601 SF) 2 tenants (8,887 SF)
East | 17 points 11 tenants (75,600 SF) 3 tenants (7,154 SF) 1 tenant (1,500 SF)
Powell | 0 points 1 tenant (2,018 SF) 1 tenant (1,480 SF) 1 tenant (307 SF)
Southwest | -2 points 3 tenants (9,294 SF) 1 tenant (8,539 SF) 1 tenant (20,789 SF)
North Delaware | -4 points 2 tenants (4,654 SF) 0 tenants (0 SF) 5 tenants (18,949 SF)
North Delaware
Powell Polaris
Dublin
Worthington Westerville New Albany Arlington/ Grandview
North Central
Easton
Gahanna/ Airport
Hilliard
CBD
East
Southwest Southeast
50,000 SF and up ..............................5 points 20,000 SF to 49,999 SF...................... 4 points 10,000 SF to 19,999 SF.......................3 points 5,000 SF to 9,999 SF.......................... 2 points 0 SF to 4,999 SF................................. 1 point 0 SF to -4,999 SF................................ -1 point -5,000 SF to -9,999 SF....................... -2 points -10,000 SF to -19,999 SF....................-3 points -20,000 SF to -49,999 SF................... -4 points -50,000 SF and below ........................-5 points
Red represents movement to the submarket, while blue represents movement from the submarket.
-
+
Migration Key
Arrows represent trending tenant movement Represents the hottest submarket of 2021 2022 TENANT REPORT
15
DEEP DIVE: TENANT MIGRATION TRENDS From 2021
Over half of the tenants that left space in Dublin signed for space elsewhere in Dublin Nearly half of tenants that left space in Gahanna/Airport migrated to Westerville
5/8 of the largest leases signed in 2021 were signed by Financial Services tenants
Over half of leases signed with the highest amount of free rent were signed by Healthcare and Personal Services tenants 50% of tenants that signed in the East submarket were in the Healthcare industry
2/3
of tenants that left space in New Albany migrated to Easton
1/3
3/4
of tenants that leased their first Central Ohio location did so in Dublin, Westerville or Worthington
of tenants that signed in Arlington/Grandview were in the Financial Services industry The most popular submarket for Law tenants was the CBD The most popular submarket for Retailing tenants was Westerville 1/4 of tenants that signed in the CBD were from outside of the Central Ohio market
1/2
16
of leases with the longest lease terms were signed by Technology tenants
2022 TENANT REPORT
70%
of leases signed with the highest TI allowances were signed in Polaris or the CBD
The average term length for leases 10,000 SF and up was nearly
7 years
2022
prediction
WHAT TO LOOK FOR IN 2022 Predictions in Tenant Behavior
TI Allowance:
Average TI allowance for 2022 could reach $25 PSF.
Lease Term:
Average lease term length for 2022 could drop to 4 years.
Over 41% of current tenants in the market are Law, Real Estate/ Construction or Financial Services companies – the three industry types with the highest average TI allowances.
Less than 30% of current tenants in the market are looking specifically in CBD, Polaris and East – the three submarkets with the highest average term lengths.
Leased SF:
Industry:
The number of tenants in the market steadily rose over the past year, from 121 tenants in December 2020 to 143 tenants in December 2021.
These industry types account for over half of tenants currently in the market, and over 1.2 million SF collectively.
With the number of tenants in the market reaching 158 in January 2022 and office users becoming more comfortable searching for space, we predict that by July, there will be around 175 tenants in the market.
Of the largest tenants in the market (looking for 40,000 SF or more), 54% of them are in these industries.
The office market can anticipate accelerated activity throughout 2022.
Business Services, Healthcare and Financial Services companies will have a major effect on the office sector in 2022.
Migration Prediction 1:
There will be a continued shift in demand from the CBD to suburban markets in 2022.
Over the past 12 months, tenant demand for space specifically in Central/Downtown has decreased by 20.5% while demand for space specifically in the suburbs has increased by
125%
Migration Prediction 2: The largest leases of 2022 will occur in the CBD, Worthington and New Albany submarkets. representing 596,500 representing 275,000 11 tenants 4 44 tenants total SF are searching in the total SF are searching in CBD
Worthington
tenants representing 200,000 total SF are searching in New Albany
2022 TENANT REPORT
17
Workplace Trends in 2022 2022 prediction
Since the COVID-19 pandemic started in early 2020, employers have faced many challenges in keeping their workforce safe and secure while also maintaining their business. Companies have been forced to adapt to the circumstances that come with living through a pandemic and adjust their requirements relating to office space. Trends like promoting collaboration within the work environment, redesigning the layout of spaces and emphasizing the importance of health and safety have become meaningful to office tenants. Below are some workplace trends to look for in 2022 as the world adapts to a post-COVID-19 world.
collaborate work environment The onset of the COVID-19 pandemic forced people to start working from home for more time than ever before. Companies started to realize many people are productive working in the comfort of their homes, but many aspects of a job involve group meetings with co-workers and clients. The office space is essential for meetings like this. There are more potential roadblocks companies deal with through remote meetings, such as technology issues, interruption from family and pets, as well as lack of adequate presentation tools. With in-person collaboration, people can bounce ideas easier and get to know their co-workers and clients much better. As a result, office spaces are turning to a collaborative work environment with more group workspaces.
redesigning layout As companies begin to redesign their office space, there is a focus on what makes the office most effective for all employees. The office offers individual, open-collaboration, and private-collaboration spaces. Companies are prioritizing creating an office environment with a combination of areas with single desks and quiet rooms for individualized work, tables and moveable chairs for open-collaboration and large tables and rooms with adequate technology for private-collaboration. This type of environment will make the transition back to the office comfortable for workers, knowing everything is in place to be productive. We predict tenants will create sections to their office that make the space fit for individual work and collaboration without the disruption of the other.
Contributor: Ryan Mitchell 18
2022 TENANT REPORT
Sources: CO by U.S. Chamber of Commerce, Forbes
“ As more companies make their way back into the office, health and safety remain a top priority. People want clear communication on what the office will look like to reduce the risk of exposure to COVID-19. We anticipate more spacing between individual desks, sanitation stations and social distancing during group meetings to continue. Companies will continue following the CDC guidelines when it comes to next steps, prioritizing employee safety.
“
continued health and safety
I think we will continue to see the addition of flex spaces with soft seating, entertainment options, comfortable flooring, natural lighting and added greenery. This will allow employees to make a decision on where they want to work during the day and switch it up as needed. - Gavin Jones Senior Project Manager, Colliers | Columbus
2022 TENANT REPORT
19
How does office space design play a role in the success of a good mentorship program within an organization?
Gracey Cantalupo Chief Marketing Officer at MentorcliQ
Can you give us a brief overview of what MentorcliQ does and what your specific role looks like? MentorcliQ powers innovative talent strategies for global Fortune 1000 and DiversityInc Top 50 organizations that are building inclusive cultures and delivering unmatched employee engagement, development and retention through mentoring. MentorcliQ helps clients increase employee engagement and retention by as much as 75%. As the Chief Marketing Officer, I lead the team that executes our brand vision and our go-to-market strategy.
Why are mentorship and collaboration so important in the current office market? The pandemic created a collective point of reflection for workers. After spending over a year immersed in emotionally and spiritually stressful work and life situations, workers now want something more than a paycheck. They want stronger connections, clear career paths and a chance to learn or enhance their skills. They want more fulfillment from work. And when they return to physical workspaces outside their homes, they want those spaces to feel as comfortable and safe as their remote offices were. 20
2022 TENANT REPORT
Forward-thinking organizations now recognize that good mentoring takes the physical space into consideration on how it impacts mentoring engagements. MentorcliQ streamlines the process to connect people and gather success data for program insights. With remote work, the vast majority of mentoring also happens remotely, so forming connections absolutely must utilize a software approach if mentoring is to be successful. As employees return to physical office spaces, both mentees and mentors need areas that make conversations enjoyable. Cubicles and rows of workstations don’t create the requisite atmosphere for enjoyable and deep mentoring conversations. A reimagining of the physical office space means designing areas that are more private without being intimidatingly so, that improve the conversational mood, and that reduce distractions. We see that you’ve worked with many prominent companies. What was one of your most rewarding client projects to work on and why? There are so many great stories it’s hard to narrow it down! One of the most common questions we get from clients is “What are other companies like us doing about (insert challenge around engagement, development, orretention)? ” To help all of our clients answer these questions, MentorcliQ created a mentoring community called MentorCom. MentorCom brings Fortune 1000 and DiversityInc Top 50 clients together to share stories about what is happening in their organizations. It is extremely rewarding to provide a venue to share these stories and help clients learn about what is working in other organizations, so they do not have to reinvent the wheel at their company.
How has COVID-19 impacted the implementation of your mentorship programs?
The big lesson from the pandemic is that remote work is not only possible and productive, but for many professional workers, it is preferred. A 2021 PwC survey found that 41% of remote workers do not want to go back to a physical office full-time. Microsoft also found that while 70% of workers want remote flexibility to continue, over 65% desire in-person time with their colleagues. I believe that companies should take an employee-led approach to “Back to The Office” instead of making it an employer-led mandate. In a recent Forbes article, we share MentorcliQ’s approach to designing and opening our new office this fall. We worked with our employees to understand both what they enjoy about working at home as well as what stresses them. We learned that while our employees enjoy the flexibility, they miss connecting and collaborating at the office. When we designed our new space we infused the best of home and workspaces. We created incentives to get employees to want to come into the office instead of mandating it. We also posted an article called Hybrid at MentorcliQ with pictures of the new office design and quotes from employees about the space. Physical offices aren’t going away, but they are changing. Companies should listen to their employees and evolve how they activate the workspace. Every challenge also presents opportunities. Companies have the opportunity to reinvent the workspace in a way that boosts creativity, teamwork, productivity, and ultimately, revenue.
“
I believe that companies should take an employee-led approach to “Back to The Office” instead of making it an employer-led mandate.
“
In your opinion, do you think we will see a major shift to permanent remote working, or do you anticipate employers bringing employees back to the office?
Even before the pandemic, employee mentoring was happening in different office locations. In fact, almost 90% of mentoring was happening in different cities and across the globe. MentorcliQ was designed to connect employees in different locations; the pandemic just shifted the location from different offices to home offices. Pre-pandemic, the majority of mentoring programs were focusing on career development, high potential leadership and supporting employee resource groups such as Women in Leadership programs. Since the shift to remote and hybrid work, we have seen a swell in demand for mentoring that focuses on fostering inclusivity, creating connection and increasing belonging.
We expect to see a consistent uptick in activity from office tenants in the market searching for space throughout 2022. Each month we are seeing more and more companies gain clarity regarding how they plan to utilize their space, which is giving them the confidence to move forward with committing to new leases. - Dan Dunsmoor SIOR Executive Vice President | Principal, Colliers | Columbus
22
2022 TENANT REPORT
2022
prediction
WHAT’S TO COME?
Despite tenants in the market dropping to 98 users in July 2020, the number of tenants searching for office space has grown to 158 users in January 2022. We foresee this demand to continue rising as companies become more comfortable entering the market for office space. Of the current tenants in the market, over half are in the business services, healthcare and financial services industries. Additionally, of the tenants searching for 40,000 square feet or more, 54% are in these industries. We predict these types of users driving activity in 2022. Tenant demand for office space in the Central/Downtown area has seen a 20.5% decrease over the past 12 months, while demand for space in the suburbs has increased by 125%. Indicating a continued shift in demand, we foresee that there will be more activity in suburban submarkets throughout the new year. Due to the COVID-19 pandemic, offering a more collaborative work environment, redesigning layouts for effectiveness and prioritizing health and safety will be ongoing trends in the office sector. TI allowances are expected to rise while lease terms could slightly decrease, on average. Central Ohio can anticipate increased activity in the new year as the market begins to rebound.
2022 TENANT REPORT
23
FORESIGHT Contact our research team today: COLLIERS GREATER COLUMBUS REGION Two Miranova Place | Suite 900 Columbus, OH 43215 +1 614 410 5179