A recent survey from CBRE of 229 corporate executives demonstrates a shift in the real estate decision-making process—access to talent outweighs real estate cost considerations.
According to the survey, 50 percent of respondents recognized talent availability as the foremost consideration in real estate decision making, while only 31 percent said overall cost should drive the discussion.
This is a trend that can be seen in Chicago, as many firms are moving downtown from the suburbs and other regions, citing talent and access to a younger workforce as the major decision driver.
Several major suburban firms have announced moves to the CBD in the last few months, while last year saw quite a few high-profile suburban-to-downtown move announcements as well.
“With real estate costs higher downtown, these decisions are definitely being driven by talent,” said Jarrett Annenberg, first vice president with CBRE. “The city is much more livable now, so this is not a move just to attract 20-somethings. A lot of senior talent lives in the city now well into their 30s.
“Until we see a shift in demographics, this trend will continue in the near future and companies in most sectors will continue to consider significant downtown office locations. And, while real estate costs downtown are higher for firms, some savings are found by efficiencies in office design geared towards a more collaborative environment that embraces technology.”
Although moving to a more desirable location can help attract top talent, it is not the only important factor in the process.
Among other findings of the survey, respondents indicated that the changing labor force—which is more generationally and ethnically diverse than ever before—places the highest importance on the desire for a great “work experience,” specifically the functionality of the workplace, freedom of work style and a sense of community.
Workplace attributes at the top of the priority list, survey respondents cited:
- Connectivity to partners and suppliers (44 percent)
- Flexible working (42 percent)
- Flexible workspace (39 percent)
- Provision of amenities (34 percent)
- Indoor environmental quality (33 percent)
- Public transportation accessibility (24 percent)
You can read the entire Americas Occupier Survey here.